Aecon reports record backlog at end of second quarter 2018
Aecon Group Inc. reported strong results for the second quarter of 2018, reflecting the early stages of realizing the benefits of a growth in backlog to a record level of $6.4 billion.
"Aecon's second quarter results illustrate the alignment of Aecon's strengths with the unprecedented market opportunity in Canada today, with record backlog of $6.4 billion at the end of the second quarter representing a 52 per cent increase since the beginning of the year," said John M. Beck, Chief Executive Officer, Aecon Group Inc. "This significant increase in backlog led to strong results in the second quarter and is expected to drive increasing growth in revenue and Adjusted EBITDA in the second half of 2018 and in 2019 as these new projects continue to ramp up during the year. Equally as exciting is the robust pipeline of opportunities still in front of us."
Earlier this week, Aecon was pleased to announce that its Board of Directors has appointed Jean-Louis Servranckx (pronounced Servranx) as the Company's President and Chief Executive Officer, effective September 4, 2018. Upon Mr. Servranckx' assumption of the CEO role, John M. Beck will assume his previous role as Executive Chair of the Board and Brian V. Tobin will resume the Lead Director role.
- Revenue of $755 million for the three months ended June 30, 2018, was higher by $69 million, or 10 per cent, compared to the second quarter of 2017.
- Adjusted EBITDA of $41.4 million (margin of 5.5 per cent) for the second quarter of 2018 compared to Adjusted EBITDA of $33.0 million (margin of 4.8 per cent) in the second quarter of 2017.
- Operating profit of $12.8 million was higher by $7.5 million and diluted earnings per share of $0.13 was higher by $0.12 compared to the second quarter of 2017.
- Record backlog as at June 30, 2018 of $6.4 billion compares to backlog of $4.4 billion as at June 30, 2017.
New contract awards of $2.6 billion were booked in the second quarter of 2018, compared to $687 million in the same period of 2017.
- A joint venture in which Aecon has a 40 per cent share, was awarded a $475 million contract to execute the Unit 6 Fuel Channel and Feeder Replacement (FCFR), at the Bruce Nuclear Generating Station in Kincardine, Ontario, the first of six such units to be refurbished;
- A consortium in which Aecon has a 33.3 per cent interest, finalized a $2.5 billion contract, that includes $1.2 billion of construction costs, for the Finch West Light Rail Transit public-private partnership project in Toronto;
- A partnership in which Aecon has a 24 per cent interest, finalized a $5.0 billion contract for the Réseau express métropolitain Montréal Light Rail Transit project, adding $1.2 billion to Aecon's backlog in the second quarter of 2018; and
- A joint venture in which Aecon has a 50 per cent interest, was awarded a $282 million pipeline construction contract for Spreads 8 and 9 of the Line 3 Replacement Phase 2 project in Manitoba.
In addition to these multiple new significant awards booked in the quarter, subsequent to quarter end, Aecon announced the award of a $248 million contract by the City of Toronto for the F.G. Gardiner Expressway Rehabilitation Project: Section 1 in Toronto.
An Aecon joint venture was one of four contractors conditionally awarded contracts to construct the proposed Coastal GasLink Pipeline project in British Columbia. Cumulatively, the value of the four conditionally awarded contracts will total $2.8 billion.
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