Stantec’s buildings and infrastructure business offsets oil and gas declines
One of Canada's largest consulting engineering companies reports 2015 year-end results.
Stantec announced its 2015 year-end results on February 25. The Edmonton-based consulting firm has 8,200 employees and 60 offices in Canada, 15,000 employees and 250 offices worldwide.
The company reported an increase in gross revenue of 13.7% in 2015, compared to 2014. However, net income had decreased 4.9% over the same period. EBITDA (earnings before interest, tax, depreciation and amortization are accounted for) increased 3.9%.
Bob Gomes, president and chief executive officer, noted that the company had benefited from growth in its infrastructure and building sector, which helped to offset a “retraction” in its energy and resources business. The oil and gas sector accounted for 15% of the company’s gross revenues in 2015, compared to 25% in 2014.
Buildings and infrastructure account for about 65% of the company’s business.
“We owe our continued profitability to the strength of our diversified business model and, as always, to our employees and their commitment to design with community in mind,” said Gomes.
The company continued to execute a “disciplined acquisition strategy,” particularly in the U.S. Six acquisitions were made during 2015, including some engineering assets of the Dessau Group in Quebec.
Stantec’s gross revenue for 2015 was C$2,877.2 million, compared to $2,529.9 million in 2014.
Its contract backlog grew 22.2% over the year to $2.2 billion at the end of 2015. The company attributes this to recent project wins, foreign exchange and acquisitions in 2015.
Diluted earnings per share decreased 5.25% to $1.65 in 2015, compared to $1.74 last year. A dividend of $0.1125 per share was declared.
The company statement mentioned growth in the healthcare, commercial and education building sectors, and in particular the securing of two major hospital projects in Quebec. The water sector in both Canada and the U.S. was strong, as was transportation in the U.S.
Specific projects mentioned were additional work at the Bonnybrook Wastewater Treatment Plant in Calgary, and a contract for full construction management services for a transportation project in Honolulu.
On February 24, the day before the 2015 results were announced, Stantec said it had signed a letter of intent to acquire Bury, Inc., a multi-disciplinary company of 300 people headquartered in Austin, Texas.
Stantec is listed on the Toronto and New York Stock Exchanges.
To read the company’s 2015 results announcement, click here.