Alithya Group Sees Impressive Growth and Record Margins

Alithya Group's Financial Performance Highlights

Q4-2025 Highlights

• Alithya Group reported revenues of $125.3 million in the fourth quarter, representing a 4.0% increase year-over-year from $120.5 million. Sequentially, revenues grew by $9.5 million, or 8.3%, from the previous quarter.
• An impressive 87% of the fourth quarter revenues stemmed from existing clients, showcasing strong client retention.
• The gross margin as a percentage of revenues surged to a record 36.8%, up from 32.1% from the same quarter last year, and exceeded 32.3% from the previous quarter.
• Gross margin increased by 19.0%, hitting $46.1 million compared to $38.7 million the previous year.
• General and administrative expenses slightly increased by 0.4% to $29.7 million, while decreasing as a percentage of revenue to 23.7% from 24.6% year-over-year.
• Net earnings surged to $8.0 million, equivalent to $0.08 per share, compared to $2.3 million and $0.02 per share reported a year ago.
• Adjusted net earnings reached $12.2 million, up 101.9% from $6.1 million, resulting in adjusted earnings per share of $0.12, compared to $0.06 a year earlier.
• Adjusted EBITDA rose 71.8% to $18.0 million, with an adjusted EBITDA margin of 14.4% of revenues, versus $10.5 million and an EBITDA margin of 8.7% for the same quarter in the previous year.
• Net cash from operating activities was $17.1 million, representing a 75.4% increase compared to $9.7 million the previous year.
• Fourth quarter bookings reached $100.1 million, yielding a book-to-bill ratio of 0.80 for the quarter.
• The backlog indicated approximately 16 months of trailing twelve-month revenues as of the company’s last reporting date.
• Alithya welcomed 22 new clients this quarter and expanded capabilities through the acquisition of eVerge Interests, Inc., enhancing its services in Salesforce and Oracle technology.

Fiscal Year 2025 Overview

• For the year, total revenues amounted to $473.5 million, down 3.6% from the previous year’s $491.1 million.
• Despite lower revenues, gross margin percentage increased to 33.0% from 30.4% in the earlier year, demonstrating improved efficiency.
• Total gross margin for the fiscal year increased to $156.1 million, compared to $149.3 million the prior year.
• Overall, selling, general, and administrative expenses decreased by 4.5% to $116.1 million from $121.6 million.
• Adjusted EBITDA for the fiscal year increased 34.4% to $47.7 million, with the adjusted EBITDA margin climbing to 10.1% from 7.2% in the prior year.
• Net earnings for Fiscal 2025 recorded a total of $1.3 million, a recovery from a loss of $16.7 million the previous year.
• Adjusted net earnings rose by 106.9% to $28.1 million, compared to $13.6 million, marking robust financial health.
• The cash flow from operating activities showed significant growth, amounting to $48.4 million, up from $15.7 million.
• The total bookings for the fiscal year reached $420.7 million, translating to a book-to-bill ratio of 0.89.
• Alithya completed the acquisition of XRM Vision Inc. during this fiscal year, enhancing Microsoft capabilities and smart shoring options.

Strategic Vision for the Future

In alignment with its long-term vision, Alithya aims to solidify its position as a leading technology advisor. By March 31, 2027, the company plans to leverage its expertise and geographic diversity to penetrate higher value IT segments. A detailed three-year strategic plan emphasizes organic growth and strategic acquisitions targeted at fulfilling digital transformation demands.

• Growth through Innovation: Alithya focuses on building strong client relationships that are rooted in trust, paving the way for organic growth.
• Strategic Acquisitions: The company is actively pursuing opportunities to expand its market presence across North America and internationally.
• Leveraging AI and IP: Increased utilization of AI solutions is a priority to enhance operational efficiency.

Management acknowledges the prevailing economic uncertainties but expresses confidence in Alithya's ability to navigate these challenges effectively while delivering value-added services to its clients.

Frequently Asked Questions

What were Alithya's key financial highlights for Q4 2025?

Alithya reported a revenue increase to $125.3 million with a gross margin of 36.8% and a net gain of $8.0 million.

How did Alithya perform in Fiscal Year 2025?

In Fiscal 2025, Alithya’s revenues were $473.5 million, down 3.6%, but adjusted net earnings surged to $28.1 million.

What strategic plans does Alithya have for the future?

Alithya aims for significant growth through a combination of organic initiatives and strategic acquisitions focused on innovation and higher-value offerings.

What acquisitions did Alithya complete recently?

Alithya acquired eVerge Interests, Inc. to bolster its Salesforce capabilities and XRM Vision Inc. to enhance Microsoft services.

How does Alithya plan to leverage technology in its services?

The company plans to enhance its service delivery using AI and proprietary technology solutions to drive efficiency and client success.

About The Author

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