GDI Integrated Facility Services (GDI) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue was CAD 616 million, down 4% year-over-year, mainly due to a 7% organic decline partially offset by a 3% positive foreign currency impact.

• Adjusted EBITDA rose 21% to CAD 34 million, with margin improving to 6% from 4% in Q1 2024.

• Net income increased to CAD 6 million (CAD 0.26/share) from CAD 0.4 million (CAD 0.02/share) in Q1 2024.

• Net operating working capital was reduced by CAD 9 million, and long-term debt (net of cash) decreased by CAD 14 million sequentially from Q4 2024.

• All business segments delivered year-over-year increases in adjusted EBITDA, despite Q1 being seasonally the slowest quarter.

Financial highlights

• Business Service Canada: Revenue of CAD 147 million, adjusted EBITDA of CAD 11 million, and a 7% margin, stable year-over-year after IT cost reallocation.

• Business Service USA: Revenue of CAD 217 million, down 4% year-over-year due to the loss of the largest client and reduced low-margin contracts; adjusted EBITDA of CAD 15 million, margin up to 7%.

• Technical Service: Revenue of CAD 246 million, down from CAD 260 million last year due to lower service calls and project timing; adjusted EBITDA of CAD 12 million, up CAD 6 million year-over-year, margin up to 5%.

• Corporate and other: Revenue of CAD 6 million, down from CAD 14 million due to the sale of the Superior distribution and retail business.

• Net cash from operating activities was CAD 35 million, up from CAD 21 million in Q1 2024.

Outlook and guidance

• Organic growth in Business Service Canada expected to return to historic levels as client churn is offset by new wins.

• Business Service USA expected to progressively recover organic growth by Q4 2025 as lost business is replaced.

• Technical Services segment outlook remains positive, with margin improvement initiatives continuing.

• Management anticipates stable margins in Business Services Canada and is actively evaluating M&A opportunities.

• M&A pipeline is healthy, with a strong balance sheet and low leverage supporting future growth.