Calian Group’s shares rose more than three per cent Thursday morning as the Kanata-based company’s revenues increased 21 per cent in the first quarter compared with a year earlier. Calian generated revenues of $179.1 million in the three-month period ending Dec. 31, up from $147.5 million in the first quarter of 2023. The firm reiterated […]
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Calian Group’s shares rose more than three per cent Thursday morning as the Kanata-based company’s revenues increased 21 per cent in the first quarter compared with a year earlier.
Calian generated revenues of $179.1 million in the three-month period ending Dec. 31, up from $147.5 million in the first quarter of 2023. The firm reiterated its full-year revenue guidance, projecting total sales of between $730 million and $780 million for fiscal 2024.
The company posted a net profit of $5.5 million, or 46 cents per diluted share, up from $4.6 million, or 39 cents per diluted share, in the same period a year earlier.
Calian’s shares were up $1.88, or 3.17 per cent, to $61.24 on the Toronto Stock Exchange by noon Thursday. The firm’s stock has risen nearly 15 per cent in the last six months as Calian’s longstanding strategy of boosting sales through a combination of acquisitions and organic growth continues to pay off.
“These results demonstrate the strength of our business model, our diversification into new markets and offerings as well as the value creation generated from our M&A agenda,” CEO Kevin Ford told analysts on a conference call Thursday morning.
“This strong performance is an early indicator of our path to reach $1 billion in (annual) revenues by the end of fiscal ’26.”
Buoyed by double-digit growth in its health, IT and advanced technology segments, Calian remains on pace to post record revenues in 2024.
Asked by an analyst whether its strong first quarter has the company trending toward the top end of its full-year guidance, Ford said it’s still too early to make any definitive predictions.
“I think we’re going to have another strong year,” he said, adding management will be “in a better position to talk about where we sit” as the second quarter moves along.
Calian’s advanced technologies division – which produces a diverse range of products from satellite components to software for the agricultural sector – was the star of the first quarter.
Its revenues soared to $51 million from $34 million a year earlier, thanks largely to an easing of supply-chain bottlenecks that had plagued the sector since the start of COVID as well as an influx of new customers from Hawaii Pacific Teleport, a company Calian acquired in 2023 that supplies satellite and fibre-based communications services in the Americas, Asia and Australia.
Health-care revenues also rose more than 20 per cent year-over-year to $50 million, fuelled by robust demand for clinical and psychological services, especially among military members and first responders, Ford said.
Meanwhile, IT and cyber solutions revenues grew 10 per cent on rising demand for IT services in the U.S., where Calian now serves more than 1,000 customers.
Ford said he expects that the IT and cyber division will experience additional organic growth in 2024 under the leadership of former Invest Ottawa CEO Michael Tremblay, who took over as president of the segment in December.
“He is already implementing changes to our strategy and go-to-market business model which are expected to support higher sales generation,” Ford said.
“Mike is really … focusing on our regions that we believe are growth opportunities and taking a customer-first view into those regions. I know there are some headwinds out there, but we still see some very good opportunities. I’m confident now with Mike and some of the changes he’s made … that we’ll soon see some organic growth in IT.”
Calian also anticipates a sales bump from its most recent M&A deal, the $74.7-million acquisition of Ottawa-based IT infrastructure provider Decisive Group late last year.
Chief financial officer Patrick Houston told analysts Calian is keeping a close eye out for other potential acquisition targets that can help it diversify its product offerings and customer base.
“We continue to have a robust pipeline of acquisitions, and we’re working hard to close a few of those in the balance of FY ’24,” Houston said.
Ford also took time to praise the contributions of longtime Calian executive Patrick Thera, who recently told the company he will be retiring after 38 years with the firm.
Thera will continue to serve as president of the advanced technology division until his replacement is hired.
“Patrick played a pivotal role in shaping the success of the advanced technology segment,” Ford said. “I am immensely grateful for his dedication, sage counsel and commitment to the business.”
