Stella-Jones (SJ) Q4 2025 earnings summary

Executive summary

• Achieved solid profitability in 2025, advancing value creation strategy with two strategic acquisitions (Locweld and Brooks) in the utility space, expanding the addressable market and infrastructure offering.

• Delivered strong results, exceeding 2023-2025 financial objectives, and set new guidance for 2026-2028.

• Returned over CAD 500 million to shareholders over three years, meeting commitment.

• Announced investment in a new U.S. greenfield steel lattice tower facility to capture infrastructure spending trends.

• Entered a partnership with First Nations for long-term fiber supply, reinforcing sustainability and supply security.

Financial highlights

• Full-year sales reached $3,492 million (CAD 3.5 billion), up from $3,469 million in 2024, driven by utility pole volume gains, acquisitions, and favorable currency.

• Gross profit for 2025 was $705 million (20.2% margin); EBITDA was $661 million (18.9% margin); net income was $337 million ($6.09 per share).

• Q4 organic sales declined 4% year-over-year, but utility poles saw 9% organic sales growth.

• Generated $557 million in operating cash flow and over $400 million in free cash flow for 2025.

• Share count reduced by over 4 million since 2023, driving 13% EPS growth over the period.

Outlook and guidance

• Guidance for 2026-2028 set, building on momentum from 2025 and recent acquisitions.

• Utility pole business expected to deliver mid-single-digit organic growth in 2026, with additional upside from steel and crossarm businesses.

• Railway tie sales guided to be flat in 2026, with positive commercial market dynamics and stable pricing.

• Residential lumber expected to remain in the $600–650 million revenue range, with low single-digit growth anticipated.

• U.S. steel lattice facility investment expected to be fully commissioned by end of 2027 to meet growing utility demand.