Bird Construction Q3 Earnings Call Highlights

Key Points

• Bird raised its 2027 revenue outlook to CAD 4.9–5.1 billion, supported by a record CAD 6.4 billion backlog and demand across its markets. It expects 2026 revenue growth to approach 25% and continues to target an 8% adjusted EBITDA margin in 2027.
• Third-quarter revenue climbed 36.7% to CAD 1.3 billion, while adjusted EBITDA rose 58.8% to CAD 106.3 million and its margin expanded to 8.2%. Growth was largely organic, led by buildings and industrial work.
• Bird sees infrastructure, nuclear, defense and data centers as growth opportunities, with infrastructure expected to help margins through more self-performed work. It ended the quarter with CAD 268 million in cash and is evaluating acquisitions to expand services and self-perform capabilities.

Bird Construction TSE: BDT raised its 2027 revenue outlook after reporting double-digit growth in third-quarter revenue and earnings, citing a record backlog and stronger margins across its construction businesses.

The company expects 2027 revenue of CAD 4.9 billion to CAD 5.1 billion, at the upper end of its original strategic target. It also anticipates full-year 2026 revenue growth approaching 25% and continues to target an 8% adjusted EBITDA margin for full-year 2027.

President and CEO Teri McKibbon said higher margins embedded in the backlog and demand spread across Bird’s markets support the outlook. The company’s trailing 12-month adjusted EBITDA margin was 7.1%, leaving it approximately 90 basis points short of the 2027 target.

Quarterly earnings outpace revenue growth

Third-quarter revenue rose 36.7% from a year earlier to CAD 1.3 billion. Almost 90% of the increase was organic, led by buildings and industrial work, with infrastructure also contributing. FRPD accounted for the balance, Chief Financial Officer Wayne Gingrich said.

Adjusted EBITDA increased 58.8% to CAD 106.3 million, while the adjusted EBITDA margin expanded to 8.2% from 7%. Adjusted earnings rose 77% to CAD 62.6 million, or CAD 1.13 per share.

Net income increased 61.2% to CAD 51.1 million, or CAD 0.92 per share. Gingrich said that figure included CAD 12.4 million in after-tax, non-cash fair-value adjustments and amortization related to warrants issued to a strategic customer. Those charges were excluded from adjusted earnings.

Gross profit rose 50.1% to CAD 153 million, and the gross margin improved to 11.8% from 10.7%. Gingrich attributed the improvement in part to building performance, project selection, cost controls and a greater share of work performed by Bird’s own teams. General and administrative expenses declined to 5.4% of revenue from 5.7%.

For the first nine months of 2026, revenue increased 24.1% to CAD 3.13 billion and adjusted EBITDA rose 39.4% to CAD 217.3 million. Cash flow from operating activities improved by CAD 199.5 million to CAD 122.8 million.

Backlog supports 2027 outlook

Bird added more than CAD 1.6 billion to backlog during the quarter, exceeding work executed by CAD 329.3 million. Backlog reached CAD 6.4 billion, while pending backlog totaled CAD 6.6 billion, including approximately CAD 1.5 billion of recurring revenue programs with work expected over the next four years.

Gingrich said the company does not need to win a large project to meet its 2027 revenue outlook. Major collaborative contracts can take around 18 months to complete design and validation, he said, meaning a large project won now would likely have a greater effect on 2028 results.

McKibbon said approximately 80% of Bird’s portfolio uses collaborative delivery, which gives the company earlier insight into project scope, schedules and resource requirements. More than CAD 1.1 billion of recently announced awards and multi-year agreements included maintenance work, electrical work for an Alberta healthcare development and projects in public infrastructure, nuclear, wind and district energy.

Bird’s work in Ontario’s Ring of Fire region includes construction of the 184-kilometre Marten Falls Community Access Road through Piinahzii LP. Gingrich said he expects work on the project to move from pending backlog into backlog in packages over time, rather than through a single large conversion. McKibbon said the release of funding triggers those movements.

Infrastructure and data centers offer growth opportunities

Bird expects growth across its industrial, buildings and infrastructure businesses, with infrastructure leading. Gingrich said infrastructure has higher equipment revenue and more self-performed work than buildings, and a larger share of infrastructure revenue could be a significant contributor to margin growth in 2027 and beyond.

McKibbon also highlighted opportunities in nuclear, defense, data centers and Arctic infrastructure. Bird’s nuclear work currently includes supporting infrastructure, including at Pickering; McKibbon said the company is not involved in small modular reactors or refurbishments beyond supporting infrastructure.

Data centers represent less than 10% of Bird’s combined backlog, McKibbon said. He identified Bell as a priority customer and said other opportunities are developing in New Brunswick and Ontario. Some Ontario projects are taking longer because of power allocations and other hurdles, although he expects some to break ground in 2027.

Asked about handling multiple data-center projects, McKibbon said phased construction works well for Bird and that the company prefers locations that are not already strained by heavy industrial activity.

Cash and acquisitions

Bird ended the quarter with CAD 268 million in cash and CAD 476.5 million available under its committed revolving credit facility. Adjusted net debt was 0.76 times trailing 12-month adjusted EBITDA, while trailing 12-month free cash flow was CAD 267 million.

Gingrich said Bird is evaluating acquisition targets that could expand its services and self-perform capabilities. McKibbon said the company expects to remain active, generally pursuing transactions in the range of its historical deals, while emphasizing strategic fit and accretive returns.

Bird also reaffirmed its targeted dividend payout of 33% of GAAP net income. Asked what most concerned him about sustaining the company’s growth, McKibbon pointed to safety rather than skilled-trades availability.

About Bird Construction (TSE:BDT)

Bird Construction Inc operates as a general contractor in the Canadian construction market. The company focuses primarily on projects in the industrial, commercial and institutional sectors of the general contracting industry. It provides construction services such as new construction for industrial, commercial, and institutional markets; industrial maintenance, repair and operations (MRO) services, heavy civil construction and contract surface mining; as well as vertical infrastructure including, electrical, mechanical, and specialty trades.

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