Calian posted a net profit of $4.5 million, or 39 cents per diluted share, compared with $1.3 million, or 11 cents per diluted share, a year earlier.
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Calian Group continued to rewrite its corporate record book in the second quarter as it posted revenues of nearly $170 million and remained on pace to hit a new all-time high in annual sales.
The Kanata-based company, which delivers a range of products and services from cybersecurity software to satellite components, reported revenues of $168.5 million for the three-month period ending March 31.
It marked the strongest second quarter in Calian’s 41-year history, with the company posting double-digit percentage growth in three of its four market segments – IT and cybersecurity, learning and advanced technologies.
The firm also signed $147 million worth of new contracts in the first three months of 2023, building its order backlog to $1.2 billion as it reiterated that it is projecting fiscal 2023 revenues of between $630 million and $680 million.
“With these new contract signings, a healthy backlog and a stronger second half expected, we remain confident in our ability to post our sixth consecutive record year,” CEO Kevin Ford told analysts Thursday morning during a conference call to announce the second-quarter results.
“Combined with our Q1 performance, this is our strongest first-half performance in company history.”
Calian posted a net profit of $4.5 million, or 39 cents per diluted share, compared with $1.3 million, or 11 cents per diluted share, a year earlier. It’s the 86th quarter in a row that Calian has finished in the black.
In addition, Calian extended its string of acquisitions after signing an agreement in March to purchase Hawaii Pacific Teleport, which supplies satellite and fibre-based communications services in the Americas, Asia and Australia.
The deal, which could be worth up to $62 million, is expected to close by the end of the fiscal year. It’s Calian’s 12th acquisition since 2020, but the first since it closed a deal to purchase U.S. IT and cybersecurity firm Computex in March 2022.
The Computex deal has paid bigger dividends than Calian originally anticipated, Ford told analysts. The Houston-based company contributed about $110 million in revenues to Calian’s IT division in the 12 months after the sale closed, far more than the $75 million Calian expected it would.
Calian is hoping for more of the same from Hawaii Pacific Teleport, which was founded in 1998 and is one of the leading satellite communications providers in the Asia-Pacific region.
The Hawaii-based enterprise is forecasted to contribute about $18 million in annual sales to Calian’s advanced technologies division. Ford said HPT’s “blue-chip roster of long-term customers” will provide a new revenue stream for Calian and offer cross-selling opportunities to existing clients.
“The team (at HPT) has built something unique and the customers realize that,” added chief financial officer Patrick Houston. “We’re optimistic that this will expand our footing in (the space sector) and get us opportunities that maybe we wouldn’t have been able to get to before.”
While Calian has been relatively quiet on the M&A front of late, Ford and Houston said the company expects to ramp up acquisition activities in upcoming quarters as it gets closer to its oft-stated goal of reaching $1 billion in annual revenues.
“We have a solid pipeline and are working hard to close more deals with similar success to the recent transactions,” Ford said.
Houston told analysts that Calian has “lots of targets in the IT segment that we’re optimistic about” and hopes to finalize an acquisition in the health sector within the next year.
“Overall, I think the (M&A) pipeline is as strong as it’s been for a long time,” he said. “Right now, it’s really just focusing on finding those deals that meet our criteria and keeping the momentum going into next year doing one to two deals again.”
Calian also announced a shakeup in its senior executive suite.
The company said this week that Sacha Gera, who has been president of its IT and cyber solutions division since September 2021, is resigning at the end of May.
Gera, an OBJ Forty Under 40 recipient in 2019, is assuming the role of chief executive at Ottawa-based Jatom Systems Inc., which makes artificial intelligence software for law enforcement and intelligence agencies and security companies in more than 30 countries.
“He’s built a great team,” Ford said of Gera. “He’s got a great opportunity with a CEO-level role at another company. We wish him all the best.”
Calian shares were down 24 cents to $61.39 in mid-afternoon trading on the Toronto Stock Exchange.
