Alithya reports strong cash flow generation and gross margin as a percentage of revenues
Q1-2025 Highlights
- Revenues decreased 8.1% to
$120.9 million , compared to$131.6 million for the same quarter last year. On a sequential basis, revenues increased by$0.4 million , from$120.5 million for the fourth quarter of last year. - 83% of revenues were generated from clients which we had in the same quarter last year.
- Gross Margin as a Percentage of Revenues(1) increased to 31.9%, compared to 28.9% for the same quarter last year.
- Gross margin increased 1.1% to
$38.5 million , compared to$38.1 million for the same quarter last year. - Selling, general and administrative expenses decreased by
$0.8 million , or 2.6%, to$31.7 million , compared to$32.5 million for the same quarter last year. - Net loss was
$2.8 million , or$0.03 per share, compared to a net loss of$7.2 million , or$0.08 per share, for the same quarter last year. - Adjusted Net Earnings(2) amounted to
$4.9 million , representing an increase of$1.9 million , or 65.1%, from$3.0 million for same quarter last year. This translated into Adjusted Net Earnings per Share(2) of$0.05 , compared to$0.03 for the same quarter last year. - Adjusted EBITDA(2) increased 11.1% to
$10.1 million , for an Adjusted EBITDA Margin(2) of 8.3% of revenues, compared to$9.1 million , for an Adjusted EBITDA Margin of 6.9% of revenues, for the same quarter last year. - Net cash from operating activities was
$16.7 million , representing an increase of$9.1 million , from$7.6 million for the same quarter last year. - Q1 Bookings(1) reached
$98.2 million , which translated into a Book-to-Bill Ratio (1) of 0.81 for the quarter. The Book-to-Bill Ratio would be 0.92 if revenues from the two long-term contracts signed as part of an acquisition in the first quarter of fiscal year 2022 were excluded. - Backlog(1) represented approximately 16 months of trailing twelve-month revenues as at
June 30, 2024 . - Signed 22 new clients.
Summary of the financial results for the first quarter:
Financial Highlights (in thousands of $, except for margin percentages) |
F2025-Q1 |
F2024-Q1 |
Revenues |
120,875 |
131,595 |
Gross Margin |
38,530 |
38,093 |
Gross Margin as a percentage of revenues (%)(1) |
31.9 % |
28.9 % |
Selling, general and administrative expenses |
31,659 |
32,499 |
Selling, general and administrative expenses as a percentage of revenues (%)(1) |
26.2 % |
24.7 % |
Net Loss |
(2,762) |
(7,245) |
Basic and Diluted Loss per Share |
(0.03) |
(0.08) |
Adjusted Net Earnings(2) |
4,944 |
2,992 |
Adjusted Net Earnings per Share(2) |
0.05 |
0.03 |
Adjusted EBITDA(2) |
10,058 |
9,055 |
Adjusted EBITDA Margin (%)(2) |
8.3 % |
6.9 % |
(1) |
These are other financial measures without a standardized definition under IFRS, which may not be comparable to similar measures used by other issuers. See "Non-IFRS and Other Financial Measures" below. |
(2) |
These are non-IFRS financial measures without a standardized definition under IFRS, which may not be comparable to similar measures used by other issuers. More information and quantitative reconciliations of Adjusted Net Earnings and Adjusted EBITDA to the most directly comparable IFRS measures are presented below under the caption "Non-IFRS and Other Financial Measures". "Adjusted EBITDA Margin" refers to the percentage of total revenue that Adjusted EBITDA represents for a given period. |
Quote by
"We are pleased to disclose financial results for the first quarter fiscal 2025. Despite global market conditions, our team delivered stable sequential revenues and continuing profitability improvements. Our adjusted EBITDA represented an increase of 11 percent over the first quarter of fiscal 2024. As clients increasingly turn to us for higher value services, our solid gross margin as a percentage of revenues reached 31.9 percent, representing incremental growth compared to the same quarter of last year. Additionally, in maintaining our cost management focus, our SG&A expenses for the first quarter of fiscal 2025 decreased by 2.6 percent year-over-year, while holding steady sequentially, despite company-wide annual salary increases on
Our team continued to deliver shareholder value in the quarter, with strong Adjusted Net Earnings and cash generation, including net cash from operating activities of
As we forge ahead in fiscal 2025, we remain focused on profitable revenue growth in alignment with the objectives of our new strategic plan, and we can clearly see the positive impacts of our operational efficiency initiatives implemented in fiscal 2024. We look forward to outlining this new plan during our Investor Day presentations on
First Quarter Results
Revenues
Revenues amounted to
Revenues in
International revenues decreased by
Gross Margin
Gross margin increased by
In
In the
International gross margin as a percentage of revenues decreased compared to the same quarter last year.
Selling, General and Administrative Expenses
Selling, general and administrative expenses totaled $31.7 million for the three months ended
Net Loss
Net loss for the three months ended
Adjusted Net Earnings
Adjusted Net Earnings amounted to
Adjusted EBITDA
Adjusted EBITDA amounted to
Liquidity and Capital Resources
For the three months ended
Favorable changes in non-cash working capital items of
Strategic Business Plan Outlook
Our strategic process begins with our agile approach to aligning our offerings with the most pressing challenges being experienced within the sectors that we service, and in our ability to continuously reinforce the building blocks of trusted relationships with our clients, our people, our investors, and our partners. To ensure that we remain innovative and relevant, we strive to meet or exceed the expectations of our stakeholders, including optimizing employee experiences, assisting our clients in achieving their missions, and creating greater value for our investors.
More specifically,
- Increasing scale through organic growth and strategic acquisitions:
- Organic Growth:
Alithya aims to achieve between 5 and 10 percent annualized organic growth. - Acquisitions:
Alithya plans to acquire complementary businesses totaling150 million dollars of revenues. - AI and IP Solutions:
Alithya intends to increase the utilization of its AI and intellectual property solutions.
- Organic Growth:
- Providing our investors, partners and stakeholders with long-term growing return on investment:
- Profitability:
Alithya's Adjusted EBITDA Margin(1) is targeted to increase to within the range of 11 to 13 percent. - Smart shoring centers:
Alithya aims to deliver an increasing percentage of its business through smart shoring centers. - Environmental goal:
Alithya endeavours to obtain Carbon Care Certification® (Level 1), and to initiate steps towards achieving carbon neutrality certification (Level 2).
- Profitability:
The objectives in our three-year strategic plan, including our organic growth, acquisition, and profitability objectives, are based on our current business plan and strategies and are not intended to be a forecast or a projection of future results. Rather, they are objectives that we seek to achieve from the execution of our strategy over time, and contemplate our historical performance and certain assumptions including but not limited to (i) our ability to execute our growth strategies, (ii) our ability to identify and acquire complementary businesses on accretive terms, and (iii) our estimates and expectations in relation to future economic and business conditions and other factors.
Forward-Looking Statements and Financial Outlook
This press release contains statements that may constitute "forward-looking information", "forward-looking statements" or "financial outlook" within the meaning of applicable Canadian securities laws and the
Forward-looking statements in this press release include, among other things, information or statements about: (i) our ability to generate sufficient earnings to support our operations; (ii) our ability to take advantage of business opportunities and meet our goals set in our three-year strategic plan; (iii) our ability to maintain and develop our business, including by broadening the scope of our service offerings, by leveraging artificial intelligence ("AI"), our geographic presence, our expertise, and our integrated offerings, and by entering into new contracts and penetrating new markets; (iv) our strategy, future operations, and prospects, including our expectations regarding future revenue resulting from bookings and backlog and providing stakeholders with long-term growing return on investment; (v) our ability to service our debt and raise additional capital; (vi) our estimates regarding our financial performance, including our revenues, profitability, costs and expenses, gross margins, liquidity, capital resources, and capital expenditures; (vii) our ability to identify suitable acquisition targets and realize the expected synergies or cost savings relating to their integration, and (viii) our ability to balance, meet and exceed the needs of our stakeholders.
Forward-looking statements are presented for the sole purpose of assisting investors and others in understanding
Forward-looking statements contained in this press release are qualified by these cautionary statements and are made only as of the date of this press release.
Non-IFRS and Other Financial Measures
This press release includes certain measures which have not been prepared in accordance with IFRS and other financial measures. Adjusted Net Earnings, Adjusted Net Earnings per Share, EBITDA, EBITDA Margin, Adjusted EBITDA and Adjusted EBITDA Margin are non-IFRS measures and Bookings, Book-to-
The following table reconciles net loss to Adjusted Net Earnings:
|
|
For the three months ended |
||
(in $ thousands) |
|
2024 |
|
2023 |
|
|
$ |
|
$ |
Net loss |
|
(2,762) |
|
(7,245) |
Business acquisition, integration and reorganization costs |
|
783 |
|
1,105 |
Amortization of intangibles |
|
4,644 |
|
6,824 |
Share-based compensation |
|
1,685 |
|
2,078 |
Impairment of property and equipment and right-of-use assets and loss on lease termination |
|
— |
|
1,383 |
Severance |
|
1,502 |
|
— |
Effect of income tax related to above items |
|
(908) |
|
(1,153) |
Adjusted Net Earnings (1)(2) |
|
4,944 |
|
2,992 |
Basic and diluted loss per share |
|
(0.03) |
|
(0.08) |
Adjusted Net Earnings per Share (1)(2) |
|
0.05 |
|
0.03 |
|
|
|
|
|
(1) Non-IFRS measure. See section 5 titled "Non-IFRS and Other Financial Measures" of |
(2) Figures for the three months ended |
The following table reconciles net loss to EBITDA and Adjusted EBITDA:
|
|
For the three months ended |
||
(in $ thousands) |
|
2024 |
|
2023 |
|
|
$ |
|
$ |
Revenues |
|
120,875 |
|
131,595 |
Net loss |
|
(2,762) |
|
(7,245) |
Net financial expenses |
|
2,372 |
|
3,220 |
Income tax expense |
|
756 |
|
150 |
Depreciation |
|
1,095 |
|
1,668 |
Amortization of intangibles |
|
4,644 |
|
6,824 |
EBITDA (1) |
|
6,105 |
|
4,617 |
EBITDA Margin (1) |
|
5.1 % |
|
3.5 % |
Adjusted for: |
|
|
|
|
Foreign exchange gain |
|
(17) |
|
(128) |
Share-based compensation |
|
1,685 |
|
2,078 |
Business acquisition, integration and reorganization costs |
|
783 |
|
1,105 |
Impairment of property and equipment and right-of-use assets and loss on lease termination |
|
— |
|
1,383 |
Severance |
|
1,502 |
|
— |
Adjusted EBITDA (1) |
|
10,058 |
|
9,055 |
Adjusted EBITDA Margin (1) |
|
8.3 % |
|
6.9 % |
|
|
|
|
|
(1) Non-IFRS measure. See section 5 titled "Non-IFRS and Other Financial Measures" of |
First Quarter Conference Call
Investor Day 2024
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Note to readers: Management's Discussion and Analysis and the interim consolidated financial statements and notes for the three months ended
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