Boardroom Insight

Consulting Sector News and Trends

Robust quarterly growth lifts Stantec’s sales to $1.2B 

Civil engineering and architecture consulting firm Stantec had a strong third quarter during which it benefited from growth in several key parts of its business.

Stantec is a Canadian company that designs skyscrapers, university campuses and other facilities, as well as large-scale infrastructure projects. Its stock has been trading on the Toronto Stock Exchange since 1994.

Stantec’s revenue rose 24.3% year-over-year in the third quarter to reach $1.2 billion. The firm’s revenue backlog from projects that it has been hired to carry out stood at $6.2 billion, an all-time record. 

One of the drivers behind Stantec’s strong third quarter showing was what the firm describes as inorganic growth. This refers to revenue growth in business units that became part of Stantec through recent corporate acquisitions.

In 2021, Stantec signed a $500 million agreement to acquire several business units of an Australian company called Cardno. Cardno’s main area of expertise is the delivery of environmental services such as habitat restoration at rivers.

The environmental services market has been long been a focus area for Stantec. The firm was founded in 1954 by the first consulting professional in Canada to have earned a doctorate degree in environmental engineering.

The 2021 deal with Cardno expanded Stantec’s environmental services business in the U.S. by more than 60%. Its Australian workforce nearly doubled.

Another bright spot for Stantec in the third quarter was its water infrastructure unit. The unit, which works on projects such as long-distance water delivery pipelines, achieved double-digit revenue growth.

Stantec’s robust sales in the third quarter helped the firm increase its profitability. The company’s adjusted earnings before depreciation, amortization and certain other line items totaled $193.3 million during the quarter, or 23.9% more than in the year-ago period.  

“As we look ahead to the remainder of the year and into 2023, we continue to see numerous growth opportunities that we are well positioned to capture, bolstering our confidence in our ability to deliver on our strategic plan,” said Stantec CEO Gord Johnston in a statement issued alongside the company’s earnings report.