WSP Global lifts earnings as U.S. project conversion slows

By Sophie Lindqvist

CAD 4.23 billion: WSP Global’s third-quarter net revenue rose 22% year over year, but U.S. project conversion (awards moving into active work) has moved onto a slower timetable. Organic growth (growth excluding acquisitions and currency effects) reached 5.1%, while revenue increased 16.6% to CAD 5.30 billion; growth across all four operating segments helped offset slower conversion in parts of the Americas.

Adjusted EBITDA (earnings before interest, tax, depreciation and amortization) rose to CAD 865 million from CAD 700 million, while adjusted EBITDA margin (adjusted EBITDA as a share of revenue) increased to 20.5% from 20.2%. Net earnings attributable to shareholders climbed to CAD 334 million, or CAD 2.48 per share, from CAD 285 million, or CAD 2.18 per share.

What does the record backlog mean?

President and CEO Alexandre L’Heureux said backlog (future work secured under awards) reached a record CAD 20.3 billion, up 23.5% over 12 months and equivalent to 11.6 months of revenue. Organic backlog growth remained at or above 5% for a second consecutive quarter.

Why are U.S. projects taking longer?

L’Heureux said WSP’s assessment of U.S. demand had not changed, but the company now expected a more measured pace of conversion from awarded projects into revenue. Federal funding reviews and delays in authorizations had affected parts of the public-sector transportation and environmental businesses.

“Our view of the U.S. opportunity has not changed. Our view of the timing has,” L’Heureux said. Improvement now depends on funding authorizations, task-order releases (project-specific instructions to begin work), project mobilization (deployment of teams) and utilization (use of project staff).

Americas organic backlog growth improved sequentially to 4.9% in the third quarter from 2.1% in the second and negative 1.4% in the first. L’Heureux put U.S. backlog at CAD 11 billion and expected project-conversion recovery to be gradual rather than linear.

For 2026, WSP expects low-single-digit organic net revenue growth in the Americas. CFO Alain Michaud said fourth-quarter emergency response services revenue should fall below the historical average because of a muted U.S. hurricane season.

Where is growth coming from?

WSP’s power and energy businesses continued to expand. POWER Engineers and TRC were growing at a double-digit pace year to date, TRC integration was progressing as planned, and the companies had more than 100 joint pursuits (combined bids).

American Electric Power recently selected WSP as a delivery partner for its Western Regulated Transmission portfolio. The framework agreement (a contract setting terms without assigning all work at once) added very little to reported backlog, although L’Heureux expects significant work over the next five years.

He said the power opportunity extends beyond data centers, citing electricity demand, aging infrastructure and the need for new generation and transmission capacity. The cited drivers extended beyond data-center demand.

How did the regions perform?

• Canada: Organic growth reached 10.2%, with strength in transportation and infrastructure, energy, mining, defense and data centers. L’Heureux said the timing of certain project milestones contributed to the quarterly result and should not be extrapolated.
• EMEIA (Europe, Middle East, India and Africa): Organic growth reached 10.5%, while backlog rose almost 12% organically over 12 months. The U.K. recorded a fifth consecutive quarter of double-digit organic growth, supported by transportation, power and energy, and data centers; WSP upgraded full-year regional organic growth guidance to mid- to high-single digits.
• APAC (Asia Pacific: Australia, New Zealand and Asia): Organic growth continued for a second consecutive quarter, but margins declined year over year. L’Heureux attributed the decline mainly to regional mix (the mix of businesses within a region) and foreign-exchange hedging effects (the accounting impact of currency protection). Continued weakness in New Zealand, where reduced public spending has weighed on activity, also contributed.

What does the 2026 outlook require?

WSP narrowed its full-year net revenue outlook to CAD 16.3 billion–CAD 16.65 billion and its adjusted EBITDA outlook to CAD 3.11 billion–CAD 3.15 billion. It reiterated the rest of its 2026 outlook.

For the fourth quarter, WSP forecasts net revenue of CAD 4.1 billion–CAD 4.45 billion and adjusted EBITDA of CAD 810 million–CAD 850 million. Michaud said the company was comfortable it would reach its 2027 adjusted EBITDA margin target of 19% in 2026.

WSP provided no 2027 guidance and plans to issue a formal outlook with its year-end results. The near-term requirement is therefore delivery rather than another change in ambition.

What changed in cash and leverage?

Third-quarter free cash flow (cash generated after capital spending) rose to CAD 333 million from CAD 315 million a year earlier. The leverage ratio (net debt relative to adjusted EBITDA) ended the quarter at 2.2 times, slightly above WSP’s target range after the TRC acquisition.

Michaud said WSP remained on track to return to that range by year-end, supported by earnings growth and cash generation. U.S. demand is not the issue; timing is.

What does WSP do?

WSP Global Inc. (TSE:WSP) provides engineering and design services to clients across Transportation & Infrastructure, Property and Buildings, Environment, Power and Energy, Resources, and Industry. It also offers strategic advisory services and operates through four reportable segments: Canada, Americas (United States and Latin America), EMEIA and APAC.