Toronto, Ontario--(Newsfile Corp. - November 4, 2025) - Dexterra Group Inc. (TSX: DXT)
Highlights
Dexterra delivered strong results in Q3 2025 generating consolidated revenue of $281.2 million, compared to $269.7 million for the same period in 2024, with Support Services revenue growth driven primarily by new sales and strong market activity levels, as well as the acquisition of Right Choice Camps and Catering Ltd. ("Right Choice").
Adjusted EBITDA in the quarter was $35.0 million (2024 - $32.0 million), an increase of 9.4% over Q3 2024. The increase in Adjusted EBITDA was primarily a result of strong camp occupancy and approximately $1.8 million from the recent investments in Pleasant Valley Corporation ("PVC") and Right Choice.
Free Cash Flow ("FCF") for Q3 was $38.0 million, compared to $11.9 million for the same period in 2024 primarily driven by strong operational results partially offset by changes in non-cash working capital.
Net earnings for the quarter were $12.9 million, compared to $7.7 million for the same period in 2024, and year-to-date net earnings in 2025 were $33.4 million compared to $13.2 million in 2024. Earnings per share was $0.21 in Q3 2025 compared to $0.12 in Q3 2024 and year-to-date was $0.53 per share versus $0.20 in 2024. Our continuing operations delivered a return on equity of 15%.
As previously announced, Dexterra acquired a 40% stake in privately owned, US-based, facilities management provider PVC for $83.5 million on July 31, 2025, including an option to acquire the remaining 60% as early as Q3 2027. PVC offers a range of distributed model facility management services including Integrated Facilities Management ("IFM") primarily to commercial and industrial clients across the United States. The investment in PVC builds on Dexterra's facilities management capability and brings increased scale to the Corporation's US-based business platform. This investment will be accounted for using the equity method and the earnings will be reported under the Support Services segment.
Dexterra also closed the previously announced acquisition of 100% of Right Choice on August 31, 2025, a workforce accommodation provider with operations in the strategic Montney / Duvernay gas region in Western Canada, for $67.5 million.
Both of the above acquisitions were financed through our credit facility and our debt to leverage ratio is expected to be below 1.7x proforma Adjusted EBITDA by December 31, 2025.
- The Corporation declared a dividend for Q4 2025 of $0.10 per share for shareholders of record at December 31, 2025, to be paid on January 15, 2026.
This news release contains certain measures and ratios, such as Adjusted EBITDA, Adjusted EBITDA as a % of revenue, FCF, and Return on Equity that do not have any standardized meaning as prescribed by GAAP and, therefore, are considered non-GAAP measures. The method of calculating these measures may differ from other entities and accordingly, may not be comparable to measures used by other entities. See "Non-GAAP measures" and "Reconciliation of Non-GAAP measures" of the Corporation's MD&A for the three and nine months ended September 30, 2025 details which is incorporated by reference herein.
Third Quarter Financial Summary
| Three months ended September 30, | Nine months ended September 30, | |||||||||||
| (000's except per share amounts) | 2025 | 2024 | 2025 | 2024 | ||||||||
| Revenue | $ | 281,228 | $ | 269,749 | $ | 770,299 | $ | 755,269 | ||||
| Adjusted EBITDA(1) | 35,036 | 32,024 | 90,241 | 80,880 | ||||||||
| Adjusted EBITDA as a % of revenue(1) | 12.5% | 11.9% | 11.7% | 10.7% | ||||||||
| Net earnings from continuing operations(2) | 12,946 | 13,359 | 33,385 | 29,956 | ||||||||
| Net earnings(2)(3) | 12,946 | 7,666 | 33,385 | 13,178 | ||||||||
| Net earnings from continuing operations per share, basic and diluted | 0.21 | 0.21 | 0.53 | 0.46 | ||||||||
| Total net earnings per share, basic and diluted(3) | 0.21 | 0.12 | 0.53 | 0.20 | ||||||||
| Total assets | 752,299 | 568,671 | 752,299 | 568,671 | ||||||||
| Total loans and borrowings ("Net Debt") | 205,747 | 102,208 | 205,747 | 102,208 | ||||||||
| Free Cash Flow(1) | 38,017 | 11,919 | 35,717 | 21,979 | ||||||||
(1) Please refer to the "Non-GAAP measures" section for the definition of Adjusted EBITDA, Adjusted EBITDA as a % of revenue, and Free Cash Flow, and to the "Reconciliation of non-GAAP measures" section for the related calculations.
(2) Acquisition costs in pre-tax earnings for the three and nine months ended September 30, 2025 were $0.6 million (2024 - $nil and $0.4 million, respectively). Please refer to the "Non-GAAP measures" section for additional details.
(3) Net earnings for the three and nine months ended September 30, 2024 included net loss from discontinued operations of $5.7 million and $16.8 million, respectively (2025 - $nil).
Third Quarter Operational Analysis
| Three months ended September 30, | Nine months ended September 30, | |||||||||||
| (000's) | 2025 | 2024 | 2025 | 2024 | ||||||||
| Revenue: | ||||||||||||
| Support Services | $ | 233,596 | $ | 218,882 | $ | 637,724 | $ | 604,708 | ||||
| Asset Based Services | 47,632 | 50,867 | 132,575 | 150,561 | ||||||||
| Total Revenue | $ | 281,228 | $ | 269,749 | $ | 770,299 | $ | 755,269 | ||||
| Adjusted EBITDA: | ||||||||||||
| Support Services | $ | 24,499 | $ | 20,151 | $ | 63,861 | $ | 55,924 | ||||
| Asset Based Services | 16,125 | 17,843 | 46,104 | 42,319 | ||||||||
| Corporate expenses | (5,588 | ) | (5,970 | ) | (19,724 | ) | (17,363 | ) | ||||
| Total Adjusted EBITDA | $ | 35,036 | $ | 32,024 | $ | 90,241 | $ | 80,880 | ||||
| Adjusted EBITDA as a % of Revenue: | ||||||||||||
| Support Services | 10.5% | 9.2% | 10.0% | 9.2% | ||||||||
| Asset Based Services | 33.9% | 35.1% | 34.8% | 28.1% | ||||||||
Support Services
Revenue for Q3 2025 was $233.6 million, an increase of 6.7% over Q3 2024, and 13.8% over Q2 2025, primarily driven by strong camp occupancy, Facilities Management ("FM") organic growth, and forestry activities, as well as the acquisition of Right Choice which contributed $3.7 million. Forestry is a seasonal business with its activities primarily taking place in Q2 and Q3 each year.
Adjusted EBITDA for Q3 2025 was $24.5 million, compared to $20.2 million for same period in 2024 and $20.5 million in Q2 2025. Adjusted EBITDA margin for Q3 2025 was 10.5%, compared to 9.2% in Q3 2024 and 10.0% in Q2 2025. The increase in Adjusted EBITDA and margin compared to Q2 2025 is due to the factors mentioned above, with PVC and Right Choice contributing $0.9 million and $0.4 million, respectively. Adjusted EBITDA margin excluding PVC, which is accounted for using the equity method, was 10.1%. Adjusted EBITDA margins are expected to continue above 9% for the remainder of 2025.
For the nine months ended September 30, 2025, Support Services revenues were $637.7 million, an increase of 5.5% over the same period in 2024, primarily driven by new sales and high occupancy at new camps, the acquisition of Right Choice and the full year contribution from the acquisition of CMI Management LLC ("CMI") which was acquired on February 29, 2024. Adjusted EBITDA for the nine months ended September 30, 2025 was $63.9 million, an increase of 14.2% over the same period in 2024, and Adjusted EBITDA margin was 10.0% compared to 9.2% for the same period in 2024. The increase in Adjusted EBITDA and margin was attributable to the factors mentioned above, as well as the inclusion of PVC, partially offset by increased overhead to support the US expansion. Adjusted EBITDA excluding PVC was $63.0 million, with a margin of 9.9%.
Asset Based Services
Revenue for Q3 2025 was $47.6 million, a decrease of 6.4% over Q3 2024, primarily driven by lower access matting activity as a result of delayed project starts by certain clients. Lower activity levels were partially offset by a $1.5 million contribution from the acquisition of Right Choice. Q3 2025 revenue increased 8.3% compared to Q2 2025 due to strong workforce accommodation structures utilization and the contribution from Right Choice.
Adjusted EBITDA for Q3 2025 was $16.1 million, a decrease of 9.6% over Q3 2024 and 2.4% over Q2 2025. Adjusted EBITDA margin for Q3 2025 was 33.9% compared to 35.1% in Q3 2024 and 37.6% in Q2 2025. Adjusted EBITDA and margin were lower in Q3 2025 as a result of the factors mentioned above, partially offset by the contribution of Right Choice of $0.5 million. Adjusted EBITDA margins in this business in the future are expected to remain between 30% to 40% depending on mix of business.
For the nine months ended September 30, 2025, ABS revenues were $132.6 million, a decrease of 11.9% over the same period in 2024, primarily driven by lower camp construction and installation revenue, as previously communicated, and lower access matting activity in 2025, partially offset by the contribution from Right Choice. Adjusted EBITDA for the nine months ended September 30, 2025 was $46.1 million, an increase of 8.9% over the same period in 2024, attributable to the change in business mix compared to the same period last year as described above. Adjusted EBITDA margin for the nine months ended September 30, 2025 was 34.8% compared to 28.1% in the prior year.
Liquidity and Capital Resources
Net debt was $205.7 million at September 30, 2025 compared to $93.4 million at Q2 2025 and $67.9 million at December 31, 2024. The increase in debt from Q4 2024 was due to the investment in PVC and the acquisition of Right Choice which added approximately $150 million to debt. The Corporation remains focused on optimizing working capital through actively working with clients for prompt payment of receivables. Adjusted EBITDA conversion to FCF is expected to exceed 50% and our debt leverage ratio is expected to be under 1.7x of Adjusted EBITDA by December 31, 2025, demonstrating our commitment to maintaining a strong balance sheet.
Additional Information
A copy of Dexterra's Condensed Consolidated Interim Financial Statements ("Financial Statements") for the three and nine months ended September 30, 2025 and 2024 and related Management's Discussion and Analysis ("MD&A") have been filed with the Canadian Securities Regulatory authorities and are available on SEDAR at sedarplus.ca and Dexterra's website at dexterra.com. The Financial Statements have been prepared in accordance with International Financial Reporting Standards and the reporting currency is in Canadian dollars.
Conference Call
Dexterra will host a conference call and webcast to begin promptly at 8:30 a.m. Eastern Time on November 5, 2025 to discuss the third quarter results.
To access the conference call by telephone the conference call dial in number is 1-844-763-8274.
A live webcast of the conference call will be accessible on Dexterra's website at ir.dexterra.com/events-presentations by selecting the Q3 2025 Results webcast link. An archived recording of the conference call will be available approximately one hour after the completion of the call until December 5, 2025 by dialing 1-855-669-9658, passcode 1032864.
About Dexterra
Dexterra employs more than 9,000 people, delivering a range of support services for the creation, management, and operation of infrastructure across Canada and the U.S.
Powered by people, Dexterra brings best-in-class regional expertise to every challenge and delivers innovative solutions, giving clients confidence in their day-to-day operations. Activities include a comprehensive range of integrated facilities management services, industry-leading workforce accommodation solutions, and other support services for diverse clients in the public and private sectors.
For further information contact:
Denise Achonu, CFO
Head office: Airway Centre, 5925 Airport Rd., Suite 1000
Mississauga, Ontario L4V 1W1
Telephone: (905) 270-1964
You can also visit our website at dexterra.com.
Reconciliation of non-GAAP measures
The following provides a reconciliation of non-GAAP measures to the nearest measure under GAAP for items presented throughout the news release:
Adjusted EBITDA
| Three months ended September 30, | Nine months ended September 30, | |||||||||||
| (000's) | 2025 | 2024 | 2025 | 2024 | ||||||||
| Net earnings from continuing operations | $ | 12,946 | $ | 13,359 | $ | 33,385 | $ | 29,956 | ||||
| Add: | ||||||||||||
| Depreciation and amortization | 10,950 | 8,890 | 30,220 | 25,593 | ||||||||
| Share based compensation | 1,901 | 1,881 | 6,066 | 3,357 | ||||||||
| (Gain) loss on disposal of property, plant and equipment | 655 | (373 | ) | 587 | (369 | ) | ||||||
| Finance costs | 3,088 | 3,336 | 7,120 | 10,694 | ||||||||
| Income tax expense | 4,565 | 4,808 | 11,635 | 10,401 | ||||||||
| Equity investment depreciation and income taxes | 330 | 123 | 627 | 887 | ||||||||
| Other(1) | 601 | - | 601 | 361 | ||||||||
| Adjusted EBITDA | $ | 35,036 | $ | 32,024 | $ | 90,241 | $ | 80,880 | ||||
(1) Other includes acquisition expenses for the three and nine months ended September 30, 2025 related to the Right Choice acquisition. Other includes acquisition expenses for the nine months ended September 30, 2024 related to the CMI acquisition.
Free Cash Flow
| Three months ended September 30, | Nine months ended September 30, | |||||||||||
| (000's) | 2025 | 2024 | 2025 | 2024 | ||||||||
| Net cash flows from continuing operating activities | $ | 45,008 | $ | 15,863 | $ | 54,132 | $ | 38,331 | ||||
| Sustaining capital expenditures, net of proceeds from the sale of property, plant and equipment and intangible assets | (1,370 | ) | 701 | (2,705 | ) | (1,330 | ) | |||||
| Finance costs paid | (2,847 | ) | (2,969 | ) | (8,431 | ) | (10,179 | ) | ||||
| Lease payments | (2,774 | ) | (1,676 | ) | (7,279 | ) | (4,843 | ) | ||||
| Free Cash Flow | $ | 38,017 | $ | 11,919 | $ | 35,717 | $ | 21,979 | ||||
Return on Equity
| Trailing twelve months ended September 30, | ||||||
| (000's) | 2025 | 2024 | ||||
| Net earnings from continuing operations | 40,970 | 38,291 | ||||
| Average total shareholders' equity(1) | 283,188 | 288,259 | ||||
| Return on Equity | 15% | 13% | ||||
(1) Average total shareholders' equity is calculated as the average of beginning total shareholders' equity and ending total shareholders' equity over the period from September 30, 2024 to September 30, 2025 for 2025 and from September 30, 2023 to September 30, 2024 for 2024.
Forward-Looking Information
Certain statements contained in this news release may constitute forward-looking information under applicable securities law. Forward-looking information may relate to Dexterra's future outlook and anticipated events, business, operations, financial performance, financial condition or results and, in some cases, can be identified by terminology such as "continue"; "forecast"; "may"; "will"; "project"; "could"; "should"; "expect"; "plan"; "anticipate"; "believe"; "outlook"; "target"; "intend"; "estimate"; "predict"; "might"; "potential"; "continue"; "foresee"; "ensure" or other similar expressions concerning matters that are not historical facts. In particular, statements regarding Dexterra's future operating results and economic performance, including return on equity and Adjusted EBITDA margins; capital allocation priorities, acquisition strategy; its capital light model, market and inflationary environment expectations, asset utilization, camp occupancy levels, its leverage, FCF, wildfire activity expectations, expected benefits from the Right Choice and PVC acquisitions, investments in technology, US tariff impacts, and its objectives and strategies are forward-looking statements. These statements are based on certain factors and assumptions, including expected growth, market recovery, results of operations, performance and business prospects and opportunities regarding Dexterra. While management considers these assumptions to be reasonable based on information currently available to Dexterra, they may prove to be incorrect. Forward-looking information is also subject to certain known and unknown risks, uncertainties and other factors that could cause Dexterra's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information, including, but not limited to: the ability to retain clients, renew existing contracts and obtain new business; an outbreak of contagious disease that could disrupt its business; the highly competitive nature of the industries in which Dexterra operates; outsourcing of services trends; reliance on suppliers and subcontractors; cost inflation; US tariff impacts; US government shutdown, volatility of industry conditions could impact demand for its services; a reduction in the availability of credit could reduce demand for Dexterra's products and services; Dexterra's significant shareholder may substantially influence its direction and operations and its interests may not align with other shareholders; its significant shareholder's approximate 51% ownership interest may impact the liquidity of the common shares; cash flow may not be sufficient to fund its ongoing activities at all times; loss of key personnel; the failure to receive or renew permits or security clearances; significant legal proceedings or regulatory proceedings/changes; environmental damage and liability is an operating risk in the industries in which Dexterra operates; climate changes could increase Dexterra's operating costs and reduce demand for its services; liabilities for failure to comply with public procurement laws and regulations; any deterioration in safety performance could result in a decline in the demand for its products and services; failure to realize anticipated benefits of acquisitions and dispositions; inability to develop and maintain relationships with Indigenous communities; the seasonality of Dexterra's business; inability to restore or replace critical capacity in a timely manner; reputational, competitive and financial risk related to cyber-attacks and breaches; failure to effectively identify and manage disruptive technology; economic downturns can reduce demand for Dexterra's services; its insurance program may not fully cover losses. Additional risks and uncertainties are described in Note 23 to the Financial Statements contained in its most recent Annual Report filed with securities regulatory authorities in Canada and available on SEDAR at sedarplus.ca. The reader should not place undue importance on forward-looking information and should not rely upon this information as of any other date. Dexterra is under no obligation and does not undertake to update or alter this information at any time, except as may be required by applicable securities law.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/273141
