Calian Group Ltd. (TSX:CGY) has released its financial results on November 26, 2025 for the fourth quarter and fiscal year ended September 30, 2025, its last under long time CEO Kevin Ford who is retiring at the end of the year and being replaced by Patrick Houston.
The company reported that revenue in Q4 increased 12% year-over-year to $203 million. This growth was balanced evenly, with 6% organic growth and 6% from acquisitions.
As to profitability, the adjusted EBITDA rose 2% to $24.3 million, with a margin of 11.9% Net profit saw an increase to $20.6 million ($1.80 per diluted share), recovering from a net loss of $0.6 million in the same period last year. Operating free cash flow stood at $17.4 million, representing a conversion rate of 72%.
For the full fiscal year, Calian delivered record revenues of $774 million, a 4% increase from FY24. While revenue grew, adjusted EBITDA for the year decreased by 15% to $78.4 million (10.1% margin), primarily due to underperformance in the ITCS (IT and Cyber Solutions) segment.
Defence opportunities
The new federal government budget with its large investment in defence would seemingly be positive news for Calian.
Ford viewed it as a positive development and he specifically linked workforce shortages across the Canadian Armed Forces, RCMP, and CBSA to increased demand for Calian’s healthcare and training services.
Ford added that while the federal government’s new defence investment agency and budget are “very positive” for Calian, the company has been “cautious” about building those specific opportunities into the 2026 numbers because the “timing of contract awards remains uncertain.”
Legacy and transformation
In his closing remarks Kevin Ford noted that annual revenues have tripled from $242 million in 2015 to $774 million in 2025. He emphasized the company’s successful diversification from a Canadian-focused, service-based business to a global solutions provider, with products now representing 25% of revenues and nearly half of operations located outside Canada.
Guidance for 2026
Patrick Houston, in discussing 2026 guidance said, “In the interest of visibility and transparency, we will not be issuing guidance as we have in past years.”
Instead the company provided the following metrics:
- Long-term target: revenue growth of 10-15% per year with a combination of organic growth and acquisitions
- FY26 guidance: grow revenue and adjusted EBITDA double-digits with existing business
- FY26 Capital deployment:
- Capex ~$10M
- Dividend target: 25-30% of OFCF
- M&A: priority for capital allocation
- Share repurchases: opportunistically
Q4 2025 Highlights
- Revenue up 12% to $203 million, including 6% from organic and 6% from acquisitions
- Gross margin at 34.0%, in line with last year
- Adjusted EBITDA1 up 2% to $24 million (margin of 11.9%)
- Operating free cash flow1 of $17 million, representing a conversion of 72%
- New contract signings of $122 million, bringing FY25 signings to over $1.1 billion
- Achieved 15% year-over-year revenue growth in defence end market solutions
- Renewed NCIB, repurchased 562,608 shares, or approximately 5% of the public float in FY25
- Launched Calian VENTURES to support the growth of Canadian Defence SMEs and partners
- Renewed and expanded debt agreement to a total of $350 million
- Completed the acquisition of Canadian-based InField Scientific after quarter end
- Awarded a contract by a leading global space technology company, after quarter end
Fiscal Year 2025 Highlights
- Revenue up 4% to $774 million
- Gross margin stood at 33.5%, in line with 34.0% last year
- Adjusted EBITDA1 down 15% to $78 million (margin 10.1%)
- Operating free cash flow1 down 28% to $52 million
- Net debt to adjusted EBITDA1 ratio of 1.1x