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Atkinsrealis Group Inc

ATRL: XTSE (CAN)
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Morningstar Rating for Stocks Fair Value Economic Moat Capital Allocation
CAD 72.00RvjcRpxysfzq

AtkinsRealis Is Poised to Drive Profitable Growth in Engineering Services Regions and Nuclear

Business Strategy and Outlook

Since Ian Edwards took the helm as president and CEO in June 2019, management has transformed and significantly derisked AtkinsRealis' portfolio. During his tenure, the company has ceased bidding on lump-sum turnkey (LSTK) projects and divested its oil and gas business. We view the new strategic direction favorably, as cost overruns on LSTK projects led to negative cash flows in recent years. The company has steadily reduced its LSTK backlog to only CAD 0.3 billion at the end of the first quarter of 2024, which we believe significantly reduces the risk of further material cost overruns. The firm’s operating cash flow inflected positive in the second half of 2023, and we expect more stable results once the firm completes the remaining LSTK backlog.

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