North American Construction Group Ltd. Announces Regional Services Contract and Outlook for 2025
North American Construction Group (NOA) has secured an extended regional services contract with a major oil sands producer, effective January 2025 through January 2029. The contract includes $500 million in committed spending, primarily for heavy equipment rentals and earthwork scopes.
The company provided outlook for 2025, projecting combined revenue of $1.4-1.6 billion and adjusted EBITDA of $415-445 million. For Q4 2024, NOA estimates revenue of $350-375 million and adjusted EBITDA of $100-110 million. The company aims to achieve a net debt leverage target of 1.8x by end of 2025, with projected free cash flow of $130-150 million for 2025.
North American Construction Group (NOA) ha ottenuto un contratto esteso per servizi regionali con un importante produttore di sabbie bituminose, valido da gennaio 2025 a gennaio 2029. Il contratto prevede 500 milioni di dollari di spese impegnate, principalmente per il noleggio di attrezzature pesanti e lavori di movimentazione terra.
L'azienda ha fornito previsioni per il 2025, stimando entrate combinate di 1,4-1,6 miliardi di dollari e EBITDA rettificato di 415-445 milioni di dollari. Per il quarto trimestre del 2024, NOA prevede entrate di 350-375 milioni di dollari e EBITDA rettificato di 100-110 milioni di dollari. L'azienda punta a raggiungere un obiettivo di leva finanziaria netta di 1,8x entro la fine del 2025, con un flusso di cassa libero previsto di 130-150 milioni di dollari per il 2025.
North American Construction Group (NOA) ha asegurado un contrato de servicios regionales extendido con un importante productor de arenas bituminosas, efectivo de enero de 2025 a enero de 2029. El contrato incluye 500 millones de dólares en gastos comprometidos, principalmente para el alquiler de equipos pesados y trabajos de movimiento de tierras.
La empresa proporcionó pronósticos para 2025, proyectando ingresos combinados de 1.4-1.6 mil millones de dólares y EBITDA ajustado de 415-445 millones de dólares. Para el cuarto trimestre de 2024, NOA estima ingresos de 350-375 millones de dólares y EBITDA ajustado de 100-110 millones de dólares. La empresa tiene como objetivo alcanzar un objetivo de apalancamiento de deuda neta de 1.8x para finales de 2025, con un flujo de caja libre proyectado de 130-150 millones de dólares para 2025.
노스 아메리칸 건설 그룹 (NOA)는 주요 오일 샌드 생산업체와 2025년 1월부터 2029년 1월까지 유효한 지역 서비스 계약을 체결했습니다. 이 계약은 주로 중장비 임대와 토공 작업을 위한 5억 달러의 지출을 포함합니다.
회사는 2025년에 대한 전망을 제공하며 14억~16억 달러의 총 수익과 4억 1500만~4억 4500만 달러의 조정된 EBITDA를 예상하고 있습니다. 2024년 4분기 동안 NOA는 3억 5000만~3억 7500만 달러의 수익과 1억~1억 1000만 달러의 조정된 EBITDA를 추정합니다. 회사는 2025년 말까지 1.8배의 순 부채 비율 목표를 달성하고 2025년에 1억 3000만~1억 5000만 달러의 자유 현금 흐름을 예상하고 있습니다.
North American Construction Group (NOA) a obtenu un contrat de services régionaux prolongé avec un important producteur de sables bitumineux, valable de janvier 2025 à janvier 2029. Le contrat comprend 500 millions de dollars de dépenses engagées, principalement pour la location d'équipements lourds et des travaux de terrassement.
L'entreprise a fourni des prévisions pour 2025, prévoyant des revenus combinés de 1,4 à 1,6 milliard de dollars et un EBITDA ajusté de 415 à 445 millions de dollars. Pour le quatrième trimestre de 2024, NOA estime des revenus de 350 à 375 millions de dollars et un EBITDA ajusté de 100 à 110 millions de dollars. L'entreprise vise à atteindre un objectif de levier d'endettement net de 1,8x d'ici la fin de 2025, avec un flux de trésorerie libre prévu de 130 à 150 millions de dollars pour 2025.
North American Construction Group (NOA) hat einen erweiterten regionalen Dienstleistungsvertrag mit einem großen Ölsandproduzenten gesichert, der von Januar 2025 bis Januar 2029 gültig ist. Der Vertrag umfasst 500 Millionen Dollar an zugesagten Ausgaben, hauptsächlich für die Miete von Schwerlastgeräten und Erdbauarbeiten.
Das Unternehmen gab einen Ausblick für 2025 und prognostiziert kombinierte Einnahmen von 1,4-1,6 Milliarden Dollar sowie bereinigtes EBITDA von 415-445 Millionen Dollar. Für das 4. Quartal 2024 schätzt NOA Einnahmen von 350-375 Millionen Dollar und bereinigtes EBITDA von 100-110 Millionen Dollar. Das Unternehmen strebt an, bis Ende 2025 ein Netto-Schuldenhebelziel von 1,8x zu erreichen, mit einem voraussichtlichen freien Cashflow von 130-150 Millionen Dollar für 2025.
- Secured $500 million committed spend contract extension through 2029
- Projected strong 2025 revenue of $1.4-1.6 billion
- Forecasted adjusted EBITDA of $415-445 million for 2025
- Substantial proforma contractual backlog of $3.6 billion
- Expected free cash flow of $130-150 million for 2025
- Targeting reduced net debt leverage to 1.8x by end of 2025
- Q4 2024 work scope deferrals into Q1 2025
- Higher Q4 2024 maintenance costs due to stronger winter season
- Increased accounts receivable expected at year-end
- Discontinuation of supply chain finance program with major customer
Insights
The contract extension and 2025 outlook present significant positive indicators for NACG. The
The
The extended regional services contract represents a strategic milestone in NACG's oil sands operations. The commitment for equipment rentals and earthwork scopes through 2029 strengthens their market position. The partnership with Mikisew Group enhances their competitive advantage through indigenous relationships, important for securing contracts in the region.
The geographical diversification across Australia, Canada and the United States positions NACG well for sustained growth. The company's focus on operational excellence and technology advancement suggests improving operational efficiency. The expected free cash flow of
ACHESON, Alberta, Dec. 05, 2024 (GLOBE NEWSWIRE) -- North American Construction Group Ltd. (“NACG” or “the Company”) (TSX:NOA.TO/NYSE:NOA) today announced the award of an extended and amended regional services contract by a major producer in the Canadian oil sands region and an outlook for the full year of 2025 along with updated estimates for the fourth quarter of 2024.
Regional Services Contract
The extended and amended contract contemplates the provision of services across various mine sites operated by the producer. The amendment is effective January 1, 2025 with the expiry date extended to January 31, 2029 from January 31, 2027.
The agreement includes committed spend of
“This is our first multi-year commitment under this agreement and we look forward to executing on our customer’s expectations and delivering safe, low-cost services. This award reaffirms our alignment with our client’s operating goals and our continued focus on efficiency and costs,” said Joe Lambert, President and CEO of NACG. “This is an important contract for us which, together with our client relationships, well maintained equipment fleet, advancing technology and focus on operational excellence, will provide ample opportunities to grow our oil sands business from the current run rate.”
“We are proud to expand our role within this partnership through this significant contract extension, which underscores our commitment to delivering exceptional value and sustainable growth in the oil sands region," said Jeff Epp, Interim Chief Executive Officer of Mikisew Group. "Our ongoing collaboration with NACG not only strengthens our ability to serve our clients with reliability and efficiency but also reinforces our dedication to supporting the economic development of the Mikisew Cree First Nation and our broader community. We look forward to advancing this partnership with a shared focus on safety, innovation, and operational excellence."
Outlook for 2025
Based on this award, the overall proforma contractual backlog of
| 2024 Q4 | Full year 2025 | |
| Key measures | ||
| Combined revenue | ||
| Adjusted EBITDA | ||
| Sustaining capital | ||
| Adjusted earnings per share | ||
| Free cash flow | ||
| Capital allocation | ||
| Growth spending | ||
| Net debt leverage | 2.0x to 2.2x | Targeting 1.8x |
Key measures
- Combined revenue and adjusted EBITDA estimates are based on existing contracts in place with the 2024 fourth quarter estimates impacted by the commencement of certain work scopes in the oil sands region being deferred into the first quarter of 2025.
- Sustaining capital estimates for the fourth quarter of 2024 reflect the front-loaded impact of maintenance costs for a stronger than expected upcoming winter season in Canada.
- Adjusted earnings per share in 2025 is based on EBITDA less existing depreciation and tax rates with interest expense expected to decrease from lower interest rates and debt levels
- Free cash flow in fourth quarter of 2024 reflects the aforementioned factors but also is being impacted by the deferral of joint venture distributions and the expectation of higher accounts receivable at year-end resulting from a projected strong December as well as the discontinuation of a supply chain finance program with a significant customer.
Capital allocation
- Growth spending in early 2025 based on continued investments in Australia required for the contracts awarded in the third quarter of 2024
- Continuation of share purchases under the existing normal-course issuer bid (NCIB) program is based on economic returns to shareholders
- Net debt target of 1.8x by end of 2025 excludes potential debenture conversion and is dependent on the achievement of key measures and activity levels within the share purchase program
“We view the upcoming year as the culmination of seven years of growth and are looking forward to a strong year of project and scope execution,” said Joe Lambert. “We have the contracted backlog in place as well as the equipment and personnel for a full twelve months of efficient and effective operations in Australia, Canada and the United States.”
About Mikisew North American Limited Partnership (MNALP)
The Company carries out heavy civil construction work in the Athabasca Oil Sands Region as a subcontractor to MNALP, a limited partnership in which the Company has a
About Mikisew Group
Mikisew Group is the Independent Economic Development arm of the Mikisew Cree First Nation. Mikisew Group is comprised of two main operating entities and ten joint venture partnerships including MNALP. These entities service the Canadian oil sands in various capacities including heavy equipment rental, fleet maintenance, transportation, emergency response, catering services, and facilities maintenance. For more information about the Mikisew Group of Companies, visit www.mikisewgroup.com.
About NACG
NACG is one of Canada and Australia’s largest providers of heavy construction and mining services. For more than 70 years, NACG has provided services to the mining, resource, and infrastructure construction markets. For more information about North American Construction Group Ltd., visit www.nacg.ca.
For further information, please contact:
Jason Veenstra, CPA, CA
Chief Financial Officer
North American Construction Group Ltd.
Phone: (780) 948-2009
Email: ir@nacg.ca
The information provided in this release contains forward-looking statements. Forward-looking statements include statements preceded by, followed by or that include the words “expected”, “estimated” or similar expressions, including the anticipated revenues and backlog to be generated by the contract. The material factors or assumptions used to develop the above forward-looking statements and the risks and uncertainties to which such forward-looking statements are subject are highlighted in the Company’s MD&A for the year ended December 31, 2023 and quarter ending September 30, 2024. Actual results could differ materially from those contemplated by such forward-looking statements because of any number of factors and uncertainties, many of which are beyond NACG’s control. Undue reliance should not be placed upon forward-looking statements and NACG undertakes no obligation, other than those required by applicable law, to update or revise those statements. For more complete information about NACG, please read our disclosure documents filed with the SEC and the CSA. These free documents can be obtained by visiting EDGAR on the SEC website at www.sec.gov or on the CSA website at www.sedar.com.
FAQ
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