AtkinsRéalis Reports Strong Growth and Record Backlog in Q2

AtkinsRéalis, a leading global engineering and consulting firm, has reported a robust performance for the second quarter of 2024, showcasing impressive revenue growth and a record-high backlog. The company’s Services division achieved a revenue increase of 17%, reaching approximately $204 million, while significant gains were also noted in its Engineering Services and Nuclear segments.

The backlog soared to approximately $15.6 billion, reflecting a 26% increase year-over-year. During their June Investor Day, AtkinsRéalis announced their new strategic initiative, “Delivering Excellence & Driving Growth,” alongside updated financial targets. The company remains optimistic regarding growth opportunities in several regions, including Canada, the UK, Ireland, the US, Latin America, and EMEA. The Nuclear division is expected to experience an organic revenue growth of 30-35% in 2024.

### Key Highlights
– Services revenue rose by 17% to $204 million.
– Engineering Services revenue grew by 12% to $1.7 billion.
– Nuclear revenue surged by 42% to $358 million.
– A record backlog of approximately $15.6 billion, a 26% increase year-over-year.
– Introduction of a new strategy at the June Investor Day.
– Notable growth opportunities identified in various regions and sectors.
– Anticipated 30-35% organic growth in Nuclear revenue for 2024.
– Active pursuit of M&A opportunities in the US.

### Company Outlook
– AtkinsRéalis is strategically positioned for sustained growth across its business segments.
– The Nuclear division is anticipated to play a key role in supporting global energy transition and infrastructure development.
– Focus on enhancing margins and cost efficiency through targeted initiatives.

### Challenges
– The company faced setbacks, losing a contract for a battery factory, which affected growth in Q2.
– There was a higher loss in the LSTK EBIT margin due to increased project closure costs, expected to stabilize in the following quarters.

### Positive Developments
– The Nuclear business showcased strong growth, with significant project wins and advancements noted in Canada, Asia, and Europe.
– Global demand for nuclear expertise continues to rise, presenting substantial opportunities for new projects and life extension work.
– Success in the Middle East with quality project wins leading to exceptional margins.

### Misses
– Despite losing the battery factory contract, AtkinsRéalis continues to see potential in other markets such as transport and property.

### Q&A Insights
During a recent conference call, CEO Ian Edwards discussed market re-entry and performance, particularly in the Middle East and the Nuclear sector in Asia. He expressed confidence in the company’s strategy and emphasized the optimistic outlook for UK infrastructure and renewable energy initiatives.

AtkinsRéalis continues to show resilience and strong performance despite the challenges faced in a dynamic global market. With a proactive focus on growth, margin improvement, and strategic acquisitions, the company is well-positioned to meet increasing demand for its services, especially in the Nuclear sector. The overall outlook remains positive as the company explores new opportunities while maintaining its full-year guidance.