WSP Global’s top boss says his string of acquisitions – four so far this year, plus its biggest ever last fall – is no barrier to the engineering firm’s future deals, even if interest rates remain high.
“Is this a barrier to future acquisitions? The answer is: absolutely not,” CEO Alexandre L’Heureux said Thursday during a conference call, referring to the US1.81 billion acquisition of the group’s environment and infrastructure sector. British John Wood in September 2022.
Since then, the company formerly known as Genivar has acquired four other engineering firms based on three continents with approximately 1,100 employees, increasing WSP’s workforce to 67,000 people.
WSP Global on Thursday posted profit and revenue up more than 20% for its third quarter, compared to last year, a result boosted by its organic growth and recent acquisitions.
Mr. L’Heureux, underlined that the order book showed a growth of 7% compared to the third quarter of last year and reached 14.28 billion, which testified, according to him, to the sustained demand for services of the company.
Organic revenue growth in North America was lower than in other regions, but L’Heureux noted that WSP continued to benefit from spending following the November 2021 passage of the 2021 budget bill. US government’s $1 trillion infrastructure.
“We’re essentially winning more than our share,” he said, adding that the “win rate” is up from a year or two ago, giving the company better shares of walk. The company’s low backlog — revenue from both confirmed contracts and those expected to materialize — increased 50% year over year in the United States, Mr. L said. ‘Happy.
Royal Bank analyst Sabahat Khan said the growing backlog was a sign that demand remained strong.
However, he cited “the uncertain macroeconomic environment” and “the financial health of key ‘public’ customers – that is, the governments of the United States, the United Kingdom (and) Canada” – as possible elements of concern. A little more than half of WSP’s revenue comes from government contracts, analysts say.
On Thursday, the Montreal company posted earnings attributable to shareholders of $156.2 million, or $1.25 per share, up 22.5% from $127.5 million, or $1.05. per share, from the same period a year earlier.
Quarterly revenues reached 3.6 billion for the quarter ended September 30, which represented a 24% increase from 2.9 billion in the previous third quarter.
On an adjusted basis, WSP’s profit rose to $1.98 per share in the most recent quarter, up from $1.59 per share a year earlier. Analysts had expected adjusted profit per share of $1.90, according to forecasts collected by financial data firm Refinitiv.