Stantec (STN) Q1 2025 earnings summary

Executive summary

• Achieved record net revenue of $1.6 billion in Q1 2025, up 13.3% year-over-year, driven by 5.9% organic and up to 7.4% acquisition growth.

• Adjusted EBITDA rose 19.1% to $252.3 million, with margin improving to 16.2% (up 70 basis points from Q1 2024).

• Adjusted EPS increased 28.9% to $1.16 compared to Q1 2024.

• Record backlog reached $7.9 billion, up 12.8% year-over-year, representing about 12 months of work.

• Major acquisitions in the US (Page) and Ireland (Ryan Hanley) will add over 1,500 employees and expand sector capabilities, positioning the company as the second largest architecture firm in the US.

Financial highlights

• Gross revenue for Q1 was up to $1.92 billion, with net revenue at $1.6 billion, both up from Q1 2024.

• Project margin improved to 54.3% of net revenue, a 10-basis-point increase year-over-year.

• Operating cash flow rose 135.8% year-over-year to $100.7 million.

• Net income grew 29.8% to $100.1 million; adjusted net income rose 28.9% to $132.8 million (8.6% of net revenue).

• Net debt-to-adjusted EBITDA ratio reduced to 1.1x, within the target range.

Outlook and guidance

• Reaffirmed 2025 guidance: net revenue growth of 7%–10%, adjusted EBITDA margin of 16.7%–17.3%, and adjusted EPS growth of 16%–19%.

• Adjusted ROIC targeted above 12%.

• Guidance excludes impact from recent acquisitions and share-based compensation revaluation.

• Organic growth in US and Canada expected in mid- to high-single digits, with Global also targeting similar growth.

• Strategic plan targets 50% net revenue growth to $7.5 billion by end of 2026.