Stantec Inc (NYSE:STN), a global leader in sustainable engineering, architecture and environmental consulting, stock rose 4.85% (As on May 15, 11:39:40 AM UTC-4, Source: Google Finance) after the company posted better than expected results for the first quarter of FY25. The company also started off the year strong on the M&A front, entering into a definitive agreement to acquire Page and with the acquisition of Ryan Hanley. Combined, these two firms will add more than 1,500 team members to Stantec and greatly contribute to the targets we set in our 2024-2026 Strategic Plan. The acquisition will deepen Stantec’s expertise and resources in key growth areas such as advanced manufacturing, data centers, and healthcare, while adding new capabilities in cleanroom design and fabrication facilities.

STN in the first quarter of FY25 has reported the adjusted earnings per share of 1.16 Canadian dollars ($0.83), beating the analysts’ estimates for the adjusted earnings per share of CA$1.10, according to analysts surveyed by FactSet. The company had reported the adjusted revenue growth of 13.3 percent to CA$1.55 billion in the first quarter of FY25, beating the analysts’ estimates for revenue of CA$1.54 billion. This is primarily driven by 5.9% organic and 3.2% acquisition growth. The Company achieved organic growth in each of Stantec’s regional and business operating units, most notably in Canada which achieved 12.2% organic growth. Adjusted EBITDA for the first quarter of 2025 increased 19.1% or $40.4 million, and adjusted EBITDA margin was 16.2%, up 70 basis points compared to the first quarter of 2024.

The company reiterated its full-year 2025 adjusted EPS growth guidance of 16% to 19% on net revenue growth of 7% to 10% with net revenue organic growth in the mid- to high- single digits. Organic growth in both US and Canada is expected to be in the mid- to high- single digits, driven by continuing strong momentum as reflected in the Company’s record-high backlog between the two countries. Organic growth in Global is also expected to achieve mid to high single-digit growth driven by continued high levels of activity in Stantec’s Water business under the ongoing Asset Management Program and frameworks and positive demand fundamentals in other Global business units. Overall, Stantec expects to drive adjusted net income to a margin of greater than 8.8% of net revenue.

The company kept its quarterly dividend at CA$0.225 per share, payable July 15 to holders of record June 30.