Montreal-based engineering consulting giant WSP Global is raising its targets for upcoming full-year results on the heels of another stronger-than-expected quarter and record-growing backlog.
The firm now expects to generate net revenue from ordinary activities in the range of $10.7 billion to $11 billion for all of 2023, compared to its previous target of between $10 billion and $10.6 billion.
WSP Global is also raising its profitability target, with (adjusted) operating profit forecast at 1.9 to 1.93 billion, 100 million more than the previous target of 1.76 to 1.76 billion. 1.84 billion.
“Our [first half] growth exceeded expectations and was driven by positive momentum across our businesses and strong demand for our services,” commented Alexandre L’Heureux, President and CEO of WSP when announcing second quarter results.
“Given these positive trends, our record backlog and recently won new contracts, we are increasing our financial outlook and approaching the second half of the year with confidence. »
In fact, WSP’s backlog at the end of the second quarter on July 1 reached a record high of $14.3 billion. In addition, the addition of orders worth four billion also represents a record level of order intake in a single quarter.
As for its most recent quarterly results, WSP Global achieved net income (attributable to shareholders) of 150.7 million in the second quarter, a considerable increase of 69% compared to the 89.3 million reached in the comparable quarter of last year.
Its revenue from ordinary activities was recorded at 3.63 billion, also a marked increase of 31% compared to the sum of 2.76 billion in the second quarter of a year ago.
Alexandre L’Heureux mentioned the United States in particular, where the strong growth in contract wins “reflects a growing need for infrastructure improvements, which we are also seeing globally with the exception of mainland China. , due to the prolonged impact of pandemic health restrictions”.
On the stock market, investors showed their appreciation for WSP Global’s results and business outlook by pushing its shares up 4.5% to $186 during Wednesday’s trading.
They ended up 2.6% at $183.14, marking a new high in market value since December 2021 for WSP Global.
In a note to investors, analyst Frédéric Bastien of the firm Raymond James in Vancouver notes that “WSP Global once again confirms its status as a must-have stock [on the stock market] with the announcement of better-than-expected results in its second quarter. “.
“The consulting engineering firm continues to deliver solid organic revenue growth, achieves an impressive increase in its order backlog and continues to exploit opportunities to improve its profit margins. »
At National Bank Financial, Toronto analyst Maxim Sytchev also noted that “WSP Global delivered another quarter of good organic revenue growth across all of its business regions, which motivated senior management to increase its key results for the year”.
“With a record backlog in the quarter, I believe WSP’s outlook for the next few years remains promising. I expect the company to be opportunistic when it comes to mergers and acquisitions (F
Asked about F
“That said,” L’Heureux pointed out, “we haven’t seen a real reduction in value expectations from potential sellers. Also, we remain extremely disciplined in terms of F
Activities: engineering consulting and project management in North America, Asia-Pacific and Europe/Middle East
Headquarters: Montreal
Global workforce: 68,800 employees
Total revenue (annualized as of July 1): CAD 13.5 billion
Operating profit (annualized to July 1): CAD 1.03 billion
Net profit (annualized to July 1): C$510.7 million
Market value (as of August 9): C$22.8 billion
