The current government shutdown, the longest in U.S. history, has had a “minimal impact” on the business of Montreal-based builder WSP, said CEO Alexandre L’Heureux during the contractor’s Q3 earnings call Thursday.
But he also noted that it can’t go on forever, lest the industry as a whole — not just WSP — feel the heat.
“If it was to go on for another month or two, I mean, clearly, the entire industry will suffer from this,” L’Heureux told investors and analysts during the call.
Myriad potential consequences have made the industry nervous — projects that rely entirely on federal dollars, for example, could face a stoppage on work the government needs to monitor or approve, experts told Construction Dive in September.
“For now, good,” L’Heureux said. “More color to be provided in Q4 at the end when and if we are not seeing any further improvement in that regard.”
Despite the shutdown, L’Heureux doubled down on the company’s commitment to the North American construction market, which echoed his earlier pronouncements during the company’s Q1 earnings call on May 8.
“Certainly, despite all the noise that we hear and the tension between our two countries, Canada and the U.S., WSP, we believe that one, if not the best place to do work and business in our space is North America,” L’Heureux said. “We continue to be focused on North America.”
M&A momentum
L’Heureux also took care to address potential future M&A moves that WSP could make. In response to an analyst question about whether the outlook on M&A is showing improvement, L’Heureux mentioned the firm’s willingness to leverage its balance sheet.
“As you can imagine, we are in a very solid position,” L’Heureux said. “I would like, obviously, to continue to use our balance sheet and use the position of strength that we're in, given our diversified platform, to be opportunistic and continue to grow platform.”
M&A activity has increased as contractors and contech firms make deals for strategic gains. WSP is no stranger to the practice — during the firm’s previous three-year strategic cycle, it made 15 acquisitions and added about 20,000 people to its headcount.
L’Heureux also took time to address rumors about WSP’s potential future acquisitions. On Oct. 24, StreetInsider reported that the company tendered an offer to buy Dallas-based construction giant Jacobs.
“I do not think anyone should be surprised because I am probably the biggest supporter and avid supporter of consolidation in our industry,” L’Heureux said. “I am not surprised that our name is being thrown around with possible rumors. Obviously, I am not going to comment on those rumors. I was a big proponent of our model 10 years ago, and I continue to be.”
The news came following its acquisitions of U.K.-based engineering firm Ricardo on Oct. 9, alongside healthcare and life sciences consulting firm Lexica on June 2.
The numbers
WSP reported revenues of 4.53 billion Canadian dollars ($3.2 billion) in the third quarter, up 13.8% from CA$3.98 billion in Q3 2024. It also saw a rise in profit of CA$284.5 million, a 39.7% jump year-over-year from CA$203.6 million.
In addition, backlog rose to CA$16.4 billion, a 10.6% increase from 2024’s CA$14.8 billion.
L’Heureux praised his firm’s performance, alongside what he called “continued, positive momentum” and championed the company’s data center work. In Q3, WSP has secured data center contracts for jobs in the U.S., Canada, Chile, Sweden, Norway, Thailand, Australia and Singapore.
However, he left investors with a note of caution going forward.
“We are currently evolving in fluid market dynamics, including, amongst other things, shifting climate priorities and evolving geopolitical contexts,” L’Heureux said. “Despite this reality, our key markets are performing well.”
