Aecon Group (TSE:ARE) executives used the company’s fourth-quarter 2025 earnings call to highlight what they described as a “transformative year” marked by record revenue, a sharp increase in backlog, reduced losses tied to legacy fixed-price projects, and growing exposure to power-related markets including nuclear, utilities, and energy infrastructure.
2025 highlights: record revenue and backlog growth
President and CEO Jean-Louis Servranckx said 2025 delivered record revenue of CAD 5.4 billion and CAD 9.5 billion of backlog additions, supported by what management called a more balanced and “de-risked” backlog profile. Revenue rose 28% from 2024, and management said 84% of the CAD 1.2 billion year-over-year increase came from organic growth.
Operationally, the company said it delivered its strongest safety performance in more than five years, completed Canada’s largest battery energy storage facility (the Oneida project), and reached substantial completion on the Finch West and Eglinton Crosstown LRTs, which were two of three remaining legacy projects. Servranckx also noted that the Darlington nuclear refurbishment program was completed “ahead of schedule and below budget” in early 2026.
Financial results: improved profitability amid remaining legacy losses
Executive Vice President and CFO Jérôme Julier reported that, on a reported basis, Aecon generated adjusted EBITDA of CAD 235 million in 2025, up from CAD 83 million in 2024. Operating profit was CAD 87 million, compared with an operating loss of CAD 60 million in 2024. Adjusted diluted earnings per share were CAD 0.40, versus an adjusted diluted loss per share of CAD 0.99 the prior year.
Legacy fixed-price projects continued to weigh on results, though at a reduced level. Management said 2025 adjusted EBITDA and operating profit were negatively impacted by CAD 94 million in legacy losses, compared with CAD 273 million in 2024. In the fourth quarter specifically, legacy projects had a CAD 6 million negative impact, according to Julier.
Backlog ended the year at a record CAD 10.7 billion, up from CAD 6.7 billion at the end of 2024, with CAD 9.5 billion of new contract awards booked during 2025.
Segment performance and mix shift toward power
In the construction segment, reported revenue was CAD 5.4 billion, up 28% year over year. Management said revenue increased across all sectors, with the largest increase in nuclear operations due to a higher volume of refurbishment, new build, and engineering services work in Ontario and the U.S.
Executives attributed industrial growth to field construction work on critical mineral facilities in Western Canada and incremental U.S. revenue from the Bodell and Trinity acquisitions completed in the third quarter of 2025. Urban transportation solutions rose primarily due to higher volume in subway and commuter rail projects, while civil revenue increased due to power and rail projects and international work, partially offset by lower highway, road, and bridge activity.
Utility operations revenue rose on increased gas distribution work in Canada and electrical work in the U.S., partially offset by lower telecommunications activity and a lower volume of battery energy storage systems work after the delivery of three grid-scale projects during the year.
On an as-adjusted basis (excluding impacts from legacy projects and divestitures), construction segment adjusted EBITDA was CAD 315 million, which management said equated to a 6% margin.
On business mix, Servranckx said roughly 55% of 2025 construction revenue was tied to power and utility services across nuclear, civil, utilities, and industrial sectors, with nuclear representing the largest share. He compared that to approximately 30% of construction revenue in 2020.
In concessions, adjusted EBITDA was $57 million compared with $87 million in 2024. Julier said this was driven by lower income from O&M activities and reduced management and development fees as certain concession projects neared or achieved substantial completion in 2025. The book value of equity in the concessions portfolio was $251 million, up 7% versus year-end 2024.
Balance sheet and dividend
Aecon reported core cash and cash equivalents of CAD 94 million, excluding CAD 393 million representing its proportionate share of cash held in joint operations. The company had CAD 1 billion of committed revolving credit facilities, with CAD 257 million drawn and CAD 4 million utilized for letters of credit at December 31, 2025. Management said there are no debt or working capital credit facility maturities until 2029 (other than equipment loans and leases in the normal course).
The board approved an annualized dividend increase of CAD 0.01 per share, resulting in a quarterly dividend of CAD 0.1925 per share, payable April 2, 2026 to shareholders of record March 23, 2026.
2026 outlook: revenue growth expected, margins to stabilize
Management said demand remains strong, citing record backlog, robust recurring revenue programs, and a strong bid pipeline. Servranckx said Aecon expects 2026 revenue to exceed 2025 levels and is focused on improving profitability and margin predictability while continuing to improve risk profile. Recurring revenue was CAD 926 million in 2025, and utility services recurring revenue increased to CAD 728 million from CAD 610 million in 2024.
Executives emphasized a shift away from fixed-price structures toward more collaborative and risk-adjusted contract models, which they said should support stabilization and gradual improvement of construction segment adjusted EBITDA margins in 2026. They also noted some remaining drag from Western Civil and legacy projects, but characterized the remaining related backlog as “sub CAD 100 million” in each category.
During Q&A, executives addressed several areas investors asked about:
- Defense infrastructure: Servranckx said Aecon had been awarded the first two pieces of the Arctic Over-the-Horizon project, describing it as collaborative with validation, development/definition, and construction phases expected to begin in 2027. He said the overall program has been publicly discussed as potentially totaling $3 billion to $5 billion, and that Aecon intends to be selective on other defense opportunities.
- Nuclear pipeline: Management highlighted continued work at Bruce and progress on Pickering’s development phase. Servranckx said Aecon is involved in the Darlington SMR project (GE Hitachi) and is “technology agnostic,” citing experience with multiple reactor technologies. He also said the Energy Northwest Cascade SMR work is in a definition phase and is expected to be “beyond” 2026 for more meaningful backlog booking.
- Bookings outlook: Executives acknowledged 2025 bookings were unusually high, driven in part by the Scarborough Subway Extension award, and pointed to potential backlog additions from items including Pickering, a Winnipeg wastewater treatment plant (development phase nearing completion), a U.S. civil job at Hansen Dam, and potential awards in urban transportation solutions.
- Capacity and labor: Servranckx said the company did not currently see labor availability as a constraint, citing strong relationships with trades and unions and a focus on de-risking contract structures.
- U.S. utility M&A: Management said multiples are strong in the U.S. utility services market and reiterated that Aecon will pursue acquisitions selectively, focusing on cultural fit, safety performance, and capabilities.
Executives concluded that they expect another “good year after an excellent year” in 2026, while tempering expectations that 2025’s pace of growth will repeat without significant M&A.
About Aecon Group (TSE:ARE)
Aecon Group Inc is a Canada-based company that operates in two segments: Construction and Concessions. The Construction segment includes various aspects of the construction of public and private infrastructure projects, mainly in the transportation sector. Its concessions segment is engaged in the development, financing, construction, and operation of infrastructure projects. Aecon generates the majority of its revenue from the Construction segment.
