Alithya Group Inc (ALYAF) Q2 2025 Earnings Call Highlights: Navigating Revenue Challenges with ...
In This Article:
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Revenue: $111.5 million, a decrease of 5.9% year over year from $118.5 million.
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Adjusted Net Earnings: $5.3 million, an increase of $5 million year over year.
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Gross Margin: Increased to 30.6% from 29.4% in the previous year.
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SG&A Expenses: $25.9 million, a decrease of 13.6% year over year.
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Adjusted EBITDA: $9.3 million, a 44% increase year over year.
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Net Cash from Operating Activities: $3 million, an increase of 117.3% year over year.
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Net Debt: Decreased to $97 million from $109 million at the end of fiscal 2024.
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US Revenue: Increased by 2.3% to $46.8 million.
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Canadian Revenue: Decreased by 12.2% to $59.6 million.
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International Revenue: Increased by 5.8% year over year.
Release Date: November 14, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Alithya Group Inc (ALYAF) reported a significant improvement in profitability with a $5 million year-over-year increase in adjusted net earnings, reaching $5.3 million in Q2.
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The company achieved a year-over-year increase in gross margin as a percentage of revenue, driven by higher demand for higher-margin services and improved workforce utilization.
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Alithya Group Inc (ALYAF) saw continued share gains in the Canadian renewable energy sector and in Oracle and Microsoft implementations, indicating strong market positioning.
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The company has a robust pipeline of opportunities in mainframe modernization, particularly in Canada, supported by its partnership with AWS and Blu Age technology.
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Alithya Group Inc (ALYAF) has successfully reduced SG&A expenses by 13.6% year-over-year, contributing to a 44% increase in adjusted EBITDA, showcasing effective cost management.
Negative Points
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Alithya Group Inc (ALYAF) experienced a 5.9% year-over-year decrease in consolidated revenues, primarily due to spending reductions in Quebec, particularly in the financial services and public sectors.
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The company faced challenges with slower project kick-offs in the current economic environment, impacting quarterly bookings and delaying the start of new large projects.
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Revenues in Canada decreased by 12.2% year-over-year, reflecting challenges in the Quebec market and the need to backfill revenue from completed large transformation projects.
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Gross margin as a percentage of revenues in the US decreased slightly due to a reduction in software revenue, which typically has higher margins.
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The company is experiencing delays in closing deals in Quebec, particularly in the banking sector, due to the complexity and size of the projects, affecting revenue recovery.