TSX:ATRL - Post Discussion
Post by
retiredcf on Nov 14, 2024 8:33am
TD
Currenty have an $87.00 target. GLTA
Q3/24 BEAT: ALL-AROUND SOLID PERFORMANCE; BACKLOG REACHES ANOTHER RECORD-HIGH
THE TD COWEN INSIGHT
Overall, we characterize ATRL's Q3/24 results release as POSITIVE. Adj. PS&PM EBITDA was ~7% above consensus. Further, ATRL's AtkinsRealis Services backlog reached
another record-high at quarter-end. Encouragingly, the company generated $267mm of consolidated cash flow from ops. (CFO) in Q3/24, suggesting that ATRL is on-track to deliver on its 2024 CFO guidance (in excess of $400mm), in our view.
Event
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Q3/24 adj. PS&PM EBITDA of $233mm was above consensus/TD at $218mm/$219mm. Meanwhile, adj. PS&PM EPS of $0.63 was also ahead of consensus/TD at $0.56/$0.55. Q3/24 cash flow from operations was +$267mm (ahead of our +$130mm estimate; CFO now +$215mm YTD). Recall, the company expects consolidated CFO to be in excess of $400mm in 2024.
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No specific update was provided regarding its previously disclosed full-year 2024 guidance (see details below).
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Conference call at 8:00 am ET (1-844-763-8274).
Impact: POSITIVE
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In AtkinsRealis Services segment, adj. EBIT of $239mm was ahead of consensus/TD at $219mm/$224mm. Engineering Services Regions segment revenue growth was +9.7% y/y (+8.4% organically), while adj. EBIT was $186mm (vs. consensus/TD at $170mm/ $174mm). Nuclear delivered +36.4% y/y revenue growth (+34.7% organically), and realized adj. EBIT of $46mm (vs. consensus/TD both at $47mm). Meanwhile, LSTK Project adj. EBIT loss was $18mm (vs. consensus/TD at $14mm/$18mm).
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AtkinsRealis Services backlog reached another record-high at quarter-end ($16.8bln vs. $15.6bln at the end of Q2/24), +7.8% q/q and +34.7% y/y. In particular, Nuclear segment backlog reached a record-high level ($3.2bln vs. $1.7bln at the end of Q2/24), +84.2% q/q and +205.9% y/y. For LSTK Projects backlog, it was $190.1mm at quarter-end (vs. $251.4mm at the end of Q2/24); -24.4% q/q; and -37.7% y/y.
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ATRL's net recourse debt-to-EBITDA ratio was 1.4x at quarter-end (vs. 1.9x at Q2/24).
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Full-Year 2024 Guidance (no incremental update provided in press release):
As a reminder, ATRL expects ESR segment full-year 2024 organic revenue growth of 8%–10% y/y. Meanwhile, the company expects ESR segment 2024 adjusted EBITDA margin expected to be in the 15%–17% range. For Nuclear segment, ATRL anticipates 2024 organic revenue growth in the range of 30%– 35% y/y. Meanwhile, ATRL expects 2024 Nuclear segment adj. EBIT margin to be in the 12%–14% range.
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