Company accumulates funds, preparing for potential purchase
After a strong financial performance in Q2 2025, WSP Global, the Montreal-based engineering firm, has demonstrated a strategic focus on acquisitions. The company's recent acquisitions of Ricardo plc and Lexica are indicative of this strategy, as both firms specialize in sectors that complement WSP's expertise in engineering, sustainability, mobility, healthcare, life sciences, and environment-related sectors.
In a move that positions WSP for further growth, the company acquired a 19.9% stake in Ricardo in June 2025, with plans to complete the full acquisition by Q4 2025, at an enterprise value of approximately £363.1 million (about $670 million). The acquisition of Lexica was also made to bolster offerings in healthcare, life sciences, and engineering.
WSP's strong balance sheet, with a net debt to adjusted EBITDA ratio of 1.5x and access to committed financing, positions them for additional acquisitions, particularly in areas where they see strategic growth such as healthcare, technology, transport, and sustainable infrastructure sectors. However, no public details have been disclosed about new specific targets beyond Ricardo and Lexica.
The company's order book also saw a significant increase, jumping nearly 11% from the previous year to $16.3 billion. This growth is a testament to WSP's reassurance about the more difficult budget situations in the United States and the United Kingdom, as infrastructure spending remains a priority.
In the second quarter, WSP generated $456.6 million in liquidity, a significant increase from $75.4 million in the same period last year. This liquidity boost, coupled with a net income attributable to shareholders for the quarter ended June 28 that reached $279.4 million, an increase from $184.1 million for the same period last year, further strengthens WSP's position.
Despite these strong results, WSP's stock saw a decline, with a closing price of $274.23, down $10.24, or 3.60%. Analyst Ian Gillies of Stifel commented that the stock was trading at 26.8 times 2026 earnings forecasts, and slightly better-than-expected results are not enough to support the stock.
However, Benoit Poirier of Desjardins Capital Markets reacted to WSP's strong financial situation, stating that it puts the company in a position to make acquisitions without issuing shares. Alexandre L'Heureux, President and CEO of WSP Global, noted that the second quarter was better for cash flow generation compared to the first quarter. Mr. Poirier also mentioned that WSP has a good track record of profitable acquisitions.
In conclusion, WSP Global's Q2 financial performance and strategic acquisitions suggest a focus on companies in transport, energy, environment, healthcare, life sciences, and related engineering consulting sectors, continuing their strategy demonstrated by the Ricardo and Lexica deals. Despite the current decline in stock price, WSP's strong financial position and strategic focus position them well for future growth.
WSP Global, due to its strong financial performance, is actively investing in strategic areas, such as healthcare, technology, and sustainable infrastructure, aiming to make additional acquisitions in these sectors. The company's recent acquisitions of Ricardo and Lexica serve as evidence of this focus, with the objective of bolstering their offerings in complementary fields.
The financial success in Q2 2025, coupled with a solid balance sheet and access to committed financing, has positioned WSP Global to make acquisitions without issuing shares, demonstrating their commitment to continuous growth.
