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AtkinsRéalis Group (ATRL.TO) shares climbed as much as 13 per cent on Thursday. Chief executive officer Ian Edwards says “mega trends” like growing demand for nuclear power and aging water infrastructure will continue to favour the Canadian engineering services firm.
The company formerly known as SNC-Lavalin reported third-quarter financial results before Thursday’s opening bell. Sales for the three months ended Sept. 30 topped $2.45 billion, up from $2.20 billion in the same quarter last year. The company’s core services segment reported a 15 per cent year-over-year revenue increase. The smaller nuclear business grew 35 per cent year-over-year.
Montreal-based AtkinsRéalis offers a wide range of professional services, spanning consulting, engineering and construction, as well as CANDU nuclear reactor technology.
“Market conditions for our engineering services and our nuclear business remain strong as we continue to support public and private entities in achieving their evolving power needs and net-zero goals,” Edwards told analysts on a post-earnings conference call on Thursday.
“We are . . . excited by the scale of our longer-term opportunities emerging from these mega trends.”
Profit in the third quarter fell on an annualized basis due to a gain last year from the company’s sale of its Scandinavian engineering services business. Net income attributable to shareholders was $103.7 million in Q3, versus $105 million in the same period last year.
AtkinsRéalis reported record-setting project backlogs as of Sept. 30, including $16.8 billion in its services segment. That’s a 35 per cent year-over-year increase.
“Overall, Q3 results were ahead of RBC/consensus forecasts and the company reiterated its 2024 guide,” RBC Capital Markets analyst Sabahat Khan wrote in a research note on Thursday.
He maintains a $70 price target on AtkinsRéalis shares, with an “outperform” rating.
Jeff Lagerquist is a senior reporter at Yahoo Finance Canada. Follow him on Twitter @jefflagerquist.
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