Calian Group (CGY) Q1 2026 earnings summary

Executive summary

• Achieved record Q1 revenue of $208 million, up 12% year-over-year, with 6% organic and 6% acquisitive growth, driven by strong demand in defense, space, and essential industries.

• Adjusted EBITDA rose 28% to $23 million, reflecting margin expansion and cost optimization.

• Simplified operating model from four to two segments: defense and space (2/3 of revenue) and essential industries (1/3), enhancing focus and operational efficiency.

• Robust backlog of $1.4 billion and $171 million in new contract signings, including major antenna and ground station projects.

• Continued momentum in European defense markets and early signs of increased activity in Canada, supported by integration of recent acquisitions.

Financial highlights

• Q1 revenue up 12% year-over-year to $208 million; organic growth contributed 6%.

• Gross margin improved to 34.1% from 31.8% year-over-year.

• Adjusted EBITDA margin increased to 11.0% from 9.6% year-over-year.

• Adjusted net profit for Q1 was $11.8 million, up from $8.4 million; adjusted EPS (diluted) rose to $1.03 from $0.71.

• Operating free cash flow was $16 million, with a 69% conversion rate.

Outlook and guidance

• Fiscal 2026 outlook unchanged: targeting 10%-15% annual revenue growth and double-digit adjusted EBITDA growth, supported by organic growth and acquisitions.

• Expect margins to improve to double-digit levels by year-end, supported by cost optimization and full-year contributions from recent acquisitions.

• Capital expenditures anticipated at $10 million for the year; dividend payout target remains 25%-30% of operating free cash flow.

• M&A remains top capital deployment priority, with a robust pipeline and several strategic transactions expected in fiscal 2026; share repurchases are paused.