MONTREAL — AtkinsRealis more than doubled its profit last quarter and raised its financial forecast for the year as the company shifts to growth and rounds out its transition to a pure-play engineering firm.
The company formerly known as SNC-Lavalin Group Inc. – whose massive, overbudget construction projects several years ago wound up draining coffers and pushing a round of cuts – notched a record backlog in its third quarter.
The AtkinsRealis Services backlog reached hit $12.5 billion at Sept. 30, helped higher in part by government contracts for energy and transportation projects in Canada, the United States and the United Kingdom.
“Strength across our services business this quarter was primarily driven by the consistent demand for our capabilities, as public entities focus on and invest in energy security and transition,” CEO Ian Edwards said.
The growing backlog has included recent wins such as a large battery plant contract in Quebec, transportation work in the U.S. and an agreement with the U.K. defence ministry, Edwards said.
Hundreds of billions of dollars in public funding for infrastructure and green technologies in the U.S. via a pair bills in the last two years remains is a key source of income targeted by AtkinsRealis.
“The line of sight to further opportunities remains vast as the U.S. will continue to invest in lowering the costs…on their aging infrastructure,” Edwards told investors on a conference call with analysts recently.
“Capital infusion from the Infrastructure Investment and Jobs Act and the Inflation Reduction Act remains in the early days.”
AtkinsRealis boosted its outlook for 2023, saying it expects organic revenue for its services business to grow between 15 per cent and 17 per cent, up from earlier expectations of 12 per cent to 15 per cent.
Net income from continuing operations amounted to $105 million or 60 cents per diluted share for the quarter ended Sept. 30, up 178 per cent from a profit of $44.7 million or 25 cents per share in the same period last year.
Revenue for the quarter totalled $2.20 billion, up 15 per cent from $1.89 billion a year earlier.
The total included professional services and project management revenue of $2.17 billion, up from $1.86 billion a year earlier, while revenue from the company’s capital investments totalled $28.9 million, down from $29.5 million a year ago.
On an adjusted basis, the company’s professional services and project management business earned 38 cents per diluted share for the quarter, up from an adjusted profit of 30 cents per share a year earlier.
The outcome beat analyst expectations of 36 cents per share, according to financial markets data firm Refinitiv.
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