ADF Group (DRX.TO) on Thursday reported lower net income and revenue for its 2026 fiscal year, but said an order backlog increase, including Groupe LAR's inclusion, and a "more neutral breakdown of the order backlog between the U.S. and Canadian projects" places it in a "more appropriate position regarding the new tariffs reality" with the United States.
ADF said net income for the fiscal year ended Jan. 31, 2026 was C$26.3 million or $0.93 per share basic and diluted, compared to $56.8 million or $1.84 per share basic and diluted last year.
The company reported revenue of $258.7 million for fiscal year ended Jan. 31, 2026, compared to $339.6 million last year. It said the decrease in revenues obliged it to implement a Work-Sharing program at its Terrebonne plant during the first quarter ended April 30, 2025. It added this program has allowed the corporation to mitigate the negative impacts of the decrease in fabrication hours, but not entirely. ADF said U.S. tariffs also had an indirect negative impact on the corporation's margins, reflecting impact caused by the increase in the price of steel set by the U.S. steel mills.
Gross margin, as a percentage of revenues, went from 31.6% for the fiscal year ended January 31, 2025, to 23.1% for the fiscal year ended January 31, 2026. It said this variation is in line with the decrease in revenues and is largely explained by the impact of U.S. tariffs.
Among other highlights, ADF cited cash flows from operations of $49.4 million for the fiscal year; record order backlog reaching $561.1 million, 57% of which is made up of Canadian contracts; and a higher cash position even with the acquisition of Groupe LAR finalized on September 18, 2025.
"Although the results for the fiscal year ended January 31, 2026 are lower than the exceptional results of the previous year, we can certainly be more than satisfied with the financial and operational performances, and the acquisition of Groupe LAR that we were able to carry out successfully, " said Jean Paschini, Chairman of the Board and Chief Executive Officer.
"The order backlog increase, including Groupe LAR's inclusion following the acquisition finalized on September 18, 2025, as well as a more neutral breakdown of the order backlog between the U.S. and Canadian projects places ADF in a more appropriate position regarding the new tariffs reality with our neighbours to the south." added Paschini.
The company also noted that, on April 15, 2026, it announced the payment of a semi-annual dividend of $0.02 per subordinate voting share and per multiple voting shares, which will be paid on May 15, 2026, to Shareholders of Record as at April 27, 2026.
Shares in DRX were down $0.63 or near 5.6% at $10.71 yesterday.