Savaria Q3 Earnings Call Highlights

Key Points

• Savaria posted record Q3 adjusted EBITDA of CAD 52.1 million, up from CAD 47.6 million a year earlier, as revenue rose 9% to CAD 245 million and net earnings increased 18.4% to CAD 23.1 million.
• Accessibility revenue grew 9.1%, with its adjusted EBITDA margin expanding to 24.2%; patient care revenue rose 8.6%, but its margin declined to 16.2% amid higher material and administrative costs and an unfavorable mix.
• Savaria reiterated its five-year targets of 12% annual revenue growth, margins above 20%, and CAD 1.6 billion in sales, while continuing manufacturing investments and pursuing about CAD 200 million in acquisitions over five years.

Savaria TSE: SIS reported record adjusted EBITDA of CAD 52.1 million in the third quarter of 2026 as home elevator and stairlift sales helped drive revenue growth, although rising costs weighed on margins in its patient care business.

Revenue rose 9% from a year earlier to CAD 245 million, including organic growth of 6.8%. Acquisitions contributed 1.4 percentage points of growth, while foreign exchange added 0.8 percentage points, Chief Financial Officer Stephen Reitknecht said on the company’s earnings call.

Adjusted EBITDA increased from CAD 47.6 million a year earlier, while the margin remained at 21.2%. Net earnings rose 18.4% to CAD 23.1 million, or CAD 0.32 per diluted share, from CAD 19.5 million, or CAD 0.27 per diluted share.

Operating income increased 28.6% to CAD 35.6 million, aided by higher revenue, gross margin expansion, lower other expenses and the termination of strategic initiative expenses, Reitknecht said. Consolidated gross margin edged up to 39.3% from 39.2%.

Accessibility Growth Offsets Patient Care Margin Pressure

Accessibility revenue increased 9.1% to CAD 196.5 million, including 6.6% organic growth. Sales rose in all regions, with Europe delivering another strong quarter, Reitknecht said. The segment’s adjusted EBITDA margin expanded to 24.2% from 23.5%.

President and CEO Sebastien Bourassa said home elevators and stairlifts remained the main growth drivers. He attributed the accessibility segment’s performance partly to Savaria’s vertically integrated operations, procurement efforts and investments in manufacturing productivity.

Asked about home elevator demand despite weaker residential construction, Bourassa pointed to the company’s distribution efforts, product options and opportunities to sell more elevators as a proportion of new homes. He also said its Luma product can be used in retrofit applications.

Patient care revenue rose 8.6% to CAD 48.6 million, including 7.5% organic growth. Higher North American project sales and growth from the U.K. were partly offset by a softer bed market, Reitknecht said.

The segment’s adjusted EBITDA margin fell to 16.2% from 18.3%, reflecting higher selling and administrative costs, an unfavorable product and project mix, and higher material costs. Bourassa cited inflation in foam and aluminum and said the company made a midyear price adjustment to help offset those pressures.

“I am confident the margins will come back better in the coming quarter,” Bourassa said. Reitknecht said the company had hoped for more operating leverage in patient care during the third quarter, but cost pressures kept gross margins relatively flat.

Jean-Philippe DeMontigny, chief transformation officer and president of Europe accessibility, said patient care growth came mostly from ceiling lift sales and installations. He also said the business ended the quarter with strong ceiling lift and bed orders.

New Products and Manufacturing Investments

Bourassa said the larger Luma L lift became available in North America in October and is scheduled to reach Europe in January 2027. He said the product received a positive response from dealers and designers and can accommodate several types of mobility devices.

Savaria is also preparing to sell products from Vipal, the Italian elevator manufacturer it acquired in July, to European dealers in the coming months, DeMontigny said. Bourassa said Vipal’s home lift and low-rise commercial elevator lineup will help the company develop its European business.

The company’s Greenville facility expansion remains on track, with the addition expected to be ready in early December, Reitknecht said. DeMontigny said Savaria commissioned a new paint line there to produce home elevator cabs in-house, with the aim of lowering costs and controlling quality.

Other initiatives included a new metal fabrication shop at the company’s Huizhou, China, facility and a U.S. assembly line for clinical M-Series lifts in St. Louis, DeMontigny said. He declined to provide a precise dollar figure for savings from the company’s cost-reduction initiatives.

Cash Flow and Growth Plans

Cash flow from operating activities fell to CAD 36.8 million from CAD 41.5 million a year earlier, as working capital used CAD 5.1 million compared with an inflow a year earlier. Reitknecht said inventory was the largest contributor to the working capital increase and is expected to decline substantially in the fourth quarter.

At September 30, available funds stood at CAD 337.7 million, up from CAD 311.7 million at year-end. Net debt declined to CAD 173.2 million from CAD 191.5 million.

Bourassa reiterated the company’s five-year ambition to grow revenue by 12% annually, maintain EBITDA margins above 20% and reach CAD 1.6 billion in sales with more than CAD 220 million in EBITDA. Asked about organic growth, he pointed to the company’s previously stated ambition of 7% to 8% a year.

He also said Savaria aims to make approximately CAD 200 million in acquisitions over five years. The company completed two acquisitions this year, Baxter Elevator in Texas and Vipal, and Bourassa said future deal activity could vary from year to year.

About Savaria (TSE:SIS)

Savaria Corporation ( savaria.com ) is a global leader in the accessibility industry. It provides accessibility solutions for the physically challenged to increase their comfort, their mobility and their independence. Its product line is one of the most comprehensive on the market. Savaria designs, manufactures, distributes and installs accessibility equipment, such as stairlifts for straight and curved stairs, vertical and inclined wheelchair lifts and elevators for home and commercial use. It also manufactures and markets a comprehensive selection of pressure management products for the medical market, medical beds for the long-term care market, as well as an extensive line of medical equipment and solutions for the safe handling of patients, including ceiling lifts and slings.

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