Good day, and welcome to the Dexterra Group Inc. fourth quarter 2025 results conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on a touch-tone phone. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Denise Achonu, Chief Financial Officer. Please go ahead.
Thank you, Betsy. Good morning. Thank you to everyone for joining the call. My name is Denise Achonu, Chief Financial Officer of Dexterra Group Inc. With me on the call today are Mark Becker, our CEO, and our board chair, Bill McFarland, who will provide some brief introductory comments. After a brief presentation, we will take questions, with the call ending by 9:15 A.M. Eastern Time. We will be commenting on our Q4 and full year 2025 results with the assumption that you have read the Q4 and full year earnings press release, MD&A, and financial statements. The slide presentation which supports today's comments is posted on our website. We encourage participants to access the slides and follow along with our presentation. Before we begin, I would like to make some comments about forward-looking information.
In yesterday's news release and on slide two of the presentation that we have posted to our website, you will find cautionary notes in that regard. We do claim their protection for any forward-looking information that we might disclose on this conference call today. I will now turn it over to Bill McFarland for his introductory comments.
Good morning. Thank you, Denise. Thank you to everyone for joining the call today. 2025 was a record year for Dexterra. CAD 123 million in EBITDA and net earnings of over CAD 40 million. The completion of two strategic acquisitions, which significantly advanced our scale and competitive position by strengthening both our U.S. integrated facilities management platform and our industry-leading remote workforce accommodation footprint. We also increased our annual dividend by 14% to CAD 0.40 per share during the year, reflecting the board's confidence in the strength and sustainability of the business, strong free cash flow generation, and our low leverage profile. Management's continued focus on disciplined execution and creating shareholder value was also rewarded by the market with over 60% appreciation in our share price over the last 14 months.
As we move into 2026, Dexterra is in an excellent position with an experienced management team led by Mark Becker and a strong and engaged workforce. We will continue to focus on building the business for the long term with the support of our major shareholder, Fairfax, and have created a business that all of our shareholders and stakeholders can be proud of. With that overview, I would like to now pass it over to Mark Becker, our CEO.
Thanks very much, Bill. Let me start by saying, you know, what a year. I just wanna say how proud I am of the Dexterra team and what we accomplished together in 2025. Our 2025 results are the accumulation or culmination of hard work over the recent years and the strong execution of our strategic plan. It's been rewarding to see the market better appreciate our business and its future potential. Looking in detail on slide 5, you know, as I mentioned, 2025 was a very busy and successful year for Dexterra. We generated a record revenue of over CAD 1 billion in revenue, adjusted EBITDA of CAD 123 million that Bill mentioned. We also delivered very really strong margins as well.
We executed on our strategy and reinforced our commitment to creating long-term value for our stakeholders. I'd like to sincerely thank our dedicated employees across the organization, our clients, our business partners, and our board for their support in reaching this achievement. Our employees' commitment to servicing our clients and delivering operational excellence really made our progress possible. In addition to delivering another year of strong, sustainable, and profitable growth, as Bill talked about, we completed two highly strategic investments in 2025, further strengthening our platform and enhancing our ability to execute our long-term strategy for both of our businesses. The addition of Pleasant Valley Corporation, along with the CMI acquisition which we completed in 2024, significantly expands our growing U.S. facility management platform.
The PVC distributed delivery model that we expect to leverage across North America is complementary to Dexterra's largely self-performed facilities management model. Our partnership with PVC is progressing very well with our collective efforts aligning on both FM and IFM growth opportunities. The acquisition of Right Choice Camps & Catering also strengthens our leadership position in the Canadian workforce accommodations market by adding to our customer base and strategically located camps, along with high-quality access equipment, providing capacity for North American growth and enhancing our ability to take advantage of potential nation-building and government infrastructure projects. We will have the Right Choice business fully integrated into the Dexterra platform within Q1. The onboarding of people and clients has been seamless for us.
Open camp optimization in the Montney/Duvernay region is also underway. We expect to utilize the equipment fleet over the medium term in support of our new growth opportunities. More specifically, in terms of fourth quarter results, I'm pleased to report that we delivered another quarter of strong financial and operating results with robust market activity levels. Strong margins across the business and contributions from our acquisition, resulting in adjusted EBITDA of CAD 33 million for Q4 and adjusted EBITDA margins expanding to 12% from 10.7% in the fourth quarter of 2024, primarily related to our mix of business. During the quarter, PVC and RightChoice contributed CAD 2 million and CAD 6 million respectively to adjusted EBITDA.
As we continue to execute our plan to deliver reliable and predictable results and deliver value from our capital allocation priorities, we are pleased to see this reflected in the appreciation of our share price, which has increased significantly. We delivered a return on equity of 15% in 2025 and CAD 34 million of free cash flow to our shareholders through dividends and share buybacks. With that, I'll turn things over to Denise to provide an overview of our segmented results and our financial position.
Thank you, Mark. Turning to slide seven, I'll begin with a detailed look at our business segments, starting with support services. Revenue and support services for the fourth quarter was CAD 231 million, an increase of 12% from Q4 2024, driven primarily from strong camp occupancy and the positive impact of the acquisition of Right Choice. As a reminder, PVC is accounted for under the equity method, and accordingly, its revenue is not included in our reported results. Q4 2025 adjusted EBITDA for support services increased by 31% over prior year to CAD 24 million, while adjusted EBITDA margins increased 10% in Q4 2025, up from 9% in Q4 2024. The improved profitability and increased margins were achieved despite the broader impact of tariffs, inflation, and general economic concerns.
This was the result of a focused effort on managing our supply chain, effective client contract management, and driving operational efficiencies in the business. PVC contributed CAD 2 million to adjusted EBITDA in the fourth quarter, while RightChoice contributed CAD 4 million in what is typically the strongest quarter for its operation. Adjusted EBITDA margins, excluding PVC, were 9.6%. Support services revenue and adjusted EBITDA in 2025 increased 7% and 18% respectively compared to 2024, consistent with the same factors already mentioned earlier. Adjusted EBITDA in 2025 from PVC and RightChoice amounted to CAD 3 million and CAD 5 million respectively. On a same footprint basis, we increased EBITDA by 9% or CAD 7 million in 2025 in a very challenging economic climate.
Our 2026 pipeline of new sales opportunities remains strong across all areas of support services, including facility management opportunities on both sides of the border. We expect adjusted EBITDA margins for support services to continue to exceed 9% in the long term. These margins reflect our team's discipline around finding the right new clients where we can deliver profitable revenue growth. The partnership with PVC is progressing well and in line with our expectations. We anticipate our investment in PVC will be cash flow neutral in the near term as we invest in the business and technology to drive strong growth in the U.S. Moving on to asset-based services on slide 8. Revenue declined 2% year-over-year in the fourth quarter due to lower project revenue related to the timing of camp installation and lower access matting rentals.
This was partially offset by the Right Choice acquisition, which contributed CAD 6 million in revenue during Q4 2025. Adjusted EBITDA of CAD 15 million increased 9% compared to Q4 2024, while adjusted EBITDA margins increased to 37% in the fourth quarter of 2025, up from 34% in the fourth quarter of 2024. The margin improvement is related to the change in business mix from higher workforce accommodation equipment utilization, which generates higher margins compared to lower camp installation project activity and the contribution from Right Choice. The timing of new camp installation activities varies based on the timing of new contract wins and client-specific timelines. We have a solid pipeline of future work and see good activity levels in oil and gas infrastructure projects, including the potential for Canadian nation-building investment.
In Q4 2025, access matting utilization was lower compared to the same period last year, which was at record levels. Utilization in Q4 2025 did increase over Q3 levels and is expected to remain strong in 2026, similar to 2025 levels. ABS revenue of CAD 173 million for 2025 compared to CAD 192 million in 2024, with the decrease due to the reasons mentioned previously, partially offset by a CAD 8 million contribution in revenue from RightChoice. Adjusted EBITDA for the year increased 9% to CAD 61 million from 2024. Adjusted EBITDA margin for the year was 35% compared to 29% in 2024. Right Choice contributed CAD 3 million in Adjusted EBITDA in the year.
On a go-forward basis, starting in Q1, we will no longer be reporting the Right Choice numbers separately as the operations will be fully integrated with the Dexterra Workforce Accommodation platform. We expect adjusted EBITDA margins for this segment to continue to remain between 30%-40%, depending on business mix. Moving to slide 9. Thanks to our strong profitability and asset-light operating model, we generated $60 million of free cash flows for the full year in 2025. Our adjusted EBITDA conversion to free cash flow of 49% was impacted by the delayed receipt of a customer receivable funded by the Canadian federal government, of which $11 million was collected subsequent to year-end. Our adjusted EBITDA conversion to free cash flow would have been 58% had that amount been collected by year-end.
Our tax losses are also now almost fully utilized, and in 2026 we are required to make income tax payments and installments for 2025 and 2026. We expect to have adjusted EBITDA conversion to free cash flow in 2026 greater than 50%, with Q3 and Q4 experiencing the highest conversion to free cash flow as a result of the seasonality of the support services business. Management of working capital remains a key focus area, primarily through actively working with our clients for prompt payment of receivables. Corporate expenses for 2025 were CAD 26 million or 2.5% of revenue, compared to 2.3% of revenue in 2024. The increase was mainly related to additional investments in sales resources to drive growth and enterprise information technology to manage the business effectively.
We expect our corporate costs to continue to approximate 2.5% of revenue in the near term. Net earnings per share of CAD 0.12 for Q4 2025, compared to CAD 0.11 for Q4 2024. During the fourth quarter as well as full year, our net earnings were impacted by an increase in share-based compensation expenses related to the strong performance of our share price in 2025. Share-based compensation, which vests over a 3-year period, includes restricted share units and performance share units, which are directly tied to total shareholder return. As a result, in the fourth quarter, the year-over-year increase in share-based compensation expense was CAD 2.1 million after tax, and for the full year, the after-tax increase was CAD 4.2 million.
Share-based compensation payments of CAD 6.7 million were made in Q1 2026 related to units that vested in early 2026. To proactively manage the situation going forward, in early 2026, the corporation entered into a total return swap arrangement with a major Canadian financial institution to effectively hedge changes in share-based compensation expense against our share price. This program will help mitigate in the future the net earnings impact of changes in our share price to share-based compensation expense. Net debt at December 31st, 2025 was 1.6x adjusted EBITDA or CAD 200 million. The PVC and Right Choice acquisitions added approximately CAD 115 million in debt in 2025. We have entered into a collar swap on our US dollar-denominated debt of $16 million to hedge against interest rate fluctuation.
Our CAD 425 million term loan matures in 2029 and has significant unused capacity for future M&A activity. In 2025, we purchased 1.5 million shares at a weighted average share price of CAD 7.80, for a total consideration of CAD 12 million, and we paid CAD 23 million in dividends. We remain committed to maintaining a strong balance sheet over the long term and expect to use a portion of our free cash flow in 2026 to pay down debt. Finally, Dexterra paid dividends of CAD 0.375 in 2025 and declared a dividend for Q1 2026 of CAD 0.10 per share for shareholders of record at March 31, 2026, to be paid April 15, 2026. I will now pass it back to Mark for concluding remarks.
Great. Thanks very much, Denise. Before we open it up for questions as usual, I'll provide some comments regarding our outlook and priorities for 2026 and beyond, which are highlighted on slide 10. Our investment and our partnership with PVC continues to progress very well as we continue to build on our shared strategic priorities. We're working jointly to leverage our complementary business models across our U.S. platform and grow our facilities management business. That'll continue to be a key focus for us in 2026 and into 2027. It's worth reinforcing as part of our outlook, you know, the potential opportunity associated with nation-building and defense-related government investments is significant across Dexterra.
With our well-established defense and government facility management capabilities, we are well positioned to support increased infrastructure and defense spending. Our workforce accommodations business is well positioned to benefit from increased nation-building investments in energy mining and various infrastructure projects. A key point for Dexterra business is our growth and our upward trajectory is not dependent on this activity. These projects really present potential upside to Dexterra's current growth plans. We continue to monitor trade developments and broader economic conditions. Dexterra remains largely insulated from direct impacts of tariffs as our work labor force and the majority of our supply inputs are domestically sourced. We are further strengthened by our supply chain through our expanded vendor programs. Renegotiation of the Canada-U.S. Mexico Agreement and ongoing U.S. trade actions present broader potential economic risks that could affect client demand, supply chain or inflation.
We're closely monitoring these developments and are well prepared to adjust our strategies as needed to mitigate potential impacts. As we demonstrated throughout last year, we remain committed to our capital allocation priorities, which include maintaining our dividend, our increased dividend, supporting sustaining and high return capital investments, pursuing additional accretive acquisitions in the medium term, and paying down debt. Want to reinforce, though, our near-term focus as it relates to acquisitions is to realize the full benefit from the strategic acquisition investments that we talked about. Additionally, we expect to make strategic investments in sales resources and technology to drive innovation, operational efficiency, and support organic FM growth. Overall, we're excited and confident in our path forward with our expanded business platform.
Our overarching strategic focus remains the delivery of consistent and predictable results, profitable growth, and our annual 50% return on equity for shareholders. This concludes our prepared remarks. I'll turn the call back to Betsy for the Q&A portion of the call.
We will now begin the question-and-answer session. To ask a question, you may press star then one on your touch-tone phone. If you are using a speaker phone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. We ask that you limit yourself to one question and one follow-up. If you have additional questions, please reenter the question queue. At this time, we will pause momentarily to assemble our roster. The first question today comes from Mark Neville with Canaccord Genuity. Please go ahead.
Good morning, Mark, Denise, Bill. Maybe first question. If I could just maybe just pick on asset-based business for a second. Obviously really good profitability, but it's been a couple quarters now where revenues have been down. Obviously, there's some moving parts in the business and with Right Choice, the integration and maybe some consolidation of the business. Just trying to level set maybe expectations for 2026 around revenue trends.
Yeah, thanks Mark, for the question. First of all, welcome to the party. We're glad to have you on board as part of our analyst community. You know, I'd say in general, you know, Denise talked about this as part of her remarks. You know, ABS side of our business, I mean, there is some lumpiness. There is some timing related to our account-based work within ABS. You know, what Denise had talked about was, you know, camp mobilizations versus ongoing turnkey contracts that we have in place. The timing of those kind of impacts the ABS revenue. It also impacts the EBITDA as well.
I think the way I would look at it, generally speaking, and then the other thing I'd mention, too, is, you know, the access matting part of our business as well, had a really, you know, strong utilization record year in 2024 in Q4, or quarter. We still have strong access matting utilizations, and we expect that to continue through this year as what we're seeing from our clients, so strong utilizations there. I think, the way I would look at it is, you know, we try to talk about our overall growth of mid-single digits in the support services business, you know, over time.
You know, we would say the same thing about ABS business of the low single-digit growth in revenue over ABS and then the 30-40% kinda margin yield, EBITDA yield, adjusted EBITDA yield in that business. I think, you know, we do see some lumpiness. We do see some variability in ABS around revenue and even ABS or margins as well. I think, you know, sticking to broad annual numbers, we would kinda see, you know, that broader guidance sort of play out, is the way I would say it and the way I would look at it, just play out in terms of the workforce accommodations business.
Got it. If I can just ask a follow-up, just to change lanes here. Just on capital, you know, buyback activity is a bit muted Q4. Balance sheet's in great shape. Just curious, you know, with the integrations ongoing, is the thought to maybe bring debt down a bit further or, is there a thought to maybe get back on the market in terms of the buyback? Thanks.
Yeah. I think, you know, we'll stay opportunistic around share buybacks. I mean, our NCIB is still active. You know, we've all seen the share price appreciation in our stock. I think the way we would the way we would continue to look at it is, you know, PVC second phase buyout is coming, and, you know, kind of post dividend, we got CAD 25 million in free cash flow conversion, and that so far is going against our debt. You know, all else being equal, and as we talked about, we wanna focus on getting full value from the PVC investment and acquisition and then the second phase buyout that's that is coming towards us and also, you know, the Right Choice acquisition.
You know, stay focused on that. You know, all else being equal and short of any other acquisitions, you know, notionally we would be, you know, providing free cash flow that would work against our balance sheet, work down our debt in that, in that period is the way I would look at it.
The next question comes from Chris Murray with ATB Capital Markets. Please go ahead.
Yeah, thanks. Good morning, folks. Mark, maybe this is a bit of a broader question, but can we talk a little bit about, you know, the camps business and how you think that that's gonna evolve over the next little while? I guess the question is more around, kind of your positioning in the broader, both maybe Canadian and North American market. I think you previously told us that, you know, you that Dexterra had about 8,000 beds. Right Choice brought together 2,000, and you'd always alluded to the fact that utilization was sort of north of 90%. I guess a couple pieces of this question. One, you know, what kind of capacity do you have for some of these new opportunities?
I know you've been able to redeploy some equipment from Western Canada, Eastern Canada, and soon you do something similar with First Choice. Does the size of the opportunity change your thinking at all about investing further in this segment? I appreciate it's got probably lower returns on capital, but I'm just trying to understand, you know, how to think about how you see the market evolving with what seems like a pretty big wave of demand with infrastructure and defense spending coming.
Yeah. Morning, Chris, and good question. You know, I think just the level set on the numbers, you know, we got about 22,000 beds under management Canada-wide, of which our own assets is actually more like 12,000 beds. We're at 10. We picked up another 2,000 beds with the Right Choice acquisition. We're about, you know, high 80s utilization combined with the Right Choice assets in play now. You know, kind of puts, you know, 90% or something a little bit north of 1,000 beds sort of available. The other thing I would point out is, you know, we do have long-term contracts. We do have camps that are on long-term arrangements. We also have project-based work that's happening that frees up equipment.
We generally kind of are looking forward. The pipeline's very strong for us, across the board for us in the business, but workforce accommodations as well, including demand for camp assets. You know, part of the rationale around the Right Choice acquisition is the excess equipment that was available. We do wanna bring that to bear. We're gonna balance that out with what we have in terms of other equipment coming available. The other thing I would say, too, is, you know, there is the ability to procure market equipment as well as needed, you know, within our sustaining growth and capital spend within the year.
Our goal is to really ensure based on the pipeline that we've got, what we see coming, that we're gonna be able to support our growth and the growth targets that I've talked about, in terms of being able to have equipment available to support our growth.
Okay. Maybe to ask another sort of related question is on, you know, kind of defense and infrastructure. You mentioned that for the support services group, you were looking to, you know, pursue some contracts additionally in there. You talked about I think the term you used in the pipeline was robust. Can you maybe describe what you're seeing in terms of the opportunity set maybe more granularly? Would that get you into a growth rate, you know... I mean, historically, we've talked about a growth rate in this business, you know, kind of in the teens or higher. Would that be something that you think is achievable over the next couple of years?
If there's any granularity you can give us on sort of like the where you're actually looking at some of these opportunities, that would be helpful.
Yeah. I think I've heard you right. I mean, you're asking about the government defense space for us, which really can feed into facility management contracts, you know, as well as even workforce combinations potentially. We do have quite a history in Canada around defense and government support. What we've seen, you know, I would say through last year and then, continuing well into this year is a lot of activity on that front around opportunities coming, you know, under development. Say, opportunities that have been around for a while, some new opportunities that are coming, a lot of them, Arctic based, you know, Arctic defense based infrastructure, Canadian Forces based defense infrastructure. There's quite a bit of activity that we're seeing on that front.
You know, I think it's really gonna depend on how it all comes to fruition. You know, there's a lot of activity around putting in proposals and supporting expanded projects. You know, certainly we're well-positioned, as you pointed out, to kind of support opportunities there. We feel really good about that. You know, again, our mid-single digit, I guess, sort of growth profile, I mean, obviously I would agree with you that, you know, depending what we see there, that could be upside to what we see in terms of growth.
We're just making sure we're really well-positioned, that we are, you know, getting our eligibility in and getting, and we are eligible for these contracts and these projects, kind of well in play, because there's really a lot of opportunity for us on that front.
The next question comes from Zachary Evershed with National Bank Financial. Please go ahead.
Hey, good morning, everyone. Congrats on the quarter.
Great. Thanks so much, Zach.
On the investment in technology that you guys are talking about, will that be capitalized, and what's your CapEx budget looking like for 2026?
Good morning, Zach. The investments that we're making in technology, specifically this year relate to around workforce management and human capital management systems. Really systems that will allow us to ensure that we're optimizing our labor performance on a go-forward basis, and therefore optimizing margins. As you know, labors are one of our most, our highest cost, I would say. As it relates to that system, no, we are expensing it, we are not capitalizing it, recognizing that we are implementing it over a number of years. This year, next year, we'll be experiencing that cost.
Even though we're expensing it, we do expect, as I mentioned in my comments around corporate expenses, to remain within that 2.5% of revenue that I mentioned. It is contained within that number. In terms of your other question around capital, for 2026, again, expecting that to kind of remain within what we've, you know, put said in the past, you know, sustaining capital kind of 1%-1.5% of revenue. That's what we're expecting for 2026.
Probably, Denise, the only thing I would add is, you know, our investment in with PVC and PVC Connect, which is our client-facing technology, that's part of the key, you know, our partnership with PVC Connect around the distributed model. There's gonna be investments in that, but that's gonna be within the partnership as well. I think somewhere in our MD&A or we know where our flagging kind of that neutral cash flow, you know, from PVC, because we're gonna be supporting that investment, which ultimately, you know, post-phase two bio will also be owned that software and it's a key part of the distributed model platform for PVC.
That's helpful. Thanks. Following up on maybe the margins and support services, it looks like the contribution from RightChoice in the support services segment was quite high on a margin basis versus the rest of the segment. Can you comment on what's driving that, please?
Yeah. Open camps are our high margin, right? We do get kind of good. You know, if you look at Right Choice's platform of activity that they had, and we're certainly taking advantage in the monthly to kind of optimize that between our camps and the Right Choice camps. Pretty much the entire Right Choice platform is kind of high margin business. We're gonna see that contribution add to us, and you know, kind of blend out the usage of that equipment and other turnkey opportunities across our network of workforce accommodation systems as we leverage those assets.
The next question comes from Sean Jack with Raymond James. Please go ahead.
Hey, good morning, guys. I just wanted to dig into the U.S. IFM a little bit more and the opportunity set there. You know, we've been hearing some reports of private company hesitation, little bit of government funding headwinds out in the markets. We're also, you know, seeing some large publicly traded FM peers finish the year quite strong. Do you guys have any comment on what you're seeing for client budgets and overall outsourcing demand?
Yeah. Good, good question, Sean. Like high activity, you know, I would say, you know, we talk about this in a lot of our investor meetings and calls. You know, the kinda outsource services business in North America is like $275 billion and growing at 6%-8% a year, which 90% of that's in the U.S. We, you know, I guess experientially see that in our, in our pipeline, you know, with the platform that we have now around CMI within government services, PVC being distributed model a lot more, a lot more related to commercial and light industrial related industrial space.
I would say we are seeing kind of a lot of activity, a lot of outsourcing activity, a lot of bidding activity and, you know, we're excited about that. You know, I think we've, you know, it's about CAD 50 million or 5% of our business is government. Still we do see activity even within governments. Certainly as I said, you know, within the commercial light industrial. Not really seeing any pullbacks yet at all. In fact, kind of more towards the opportunity that we're seeing, that we've been flagging more, kind of more broadly in terms of our US growth profile.
Okay, perfect. Thanks for that. Second one, just thinking about the fleet optimization that's happening with Right Choice and HS at the moment, should we expect to see margins improve at all in the short term, because of this exercise or is this just more about freeing up capacity for new projects?
I think a lot of it is freeing up capacity for new projects. You know, I think we are seeing a lot of activity in the mining and open camps, which as I mentioned a minute ago, is high margin. You know, you've seen our margins be a bit higher because of workforce accommodations activity and occupancy, which a lot of that is within open camps. A lot of that's within turnkey camps, which tends to be higher margin. That is kind of a key driver of what you're seeing overall in terms of our workforce accommodations or support services margins. You know, from what everything we're seeing from clients, we expect that to continue.
You know, Sean, I'd really say, you know, having the equipment available, which we've talked about so much, is kind of the key part of that. I think the activity levels and the industry activity levels, the size of our pipeline is really gonna be the key driver of our margins within the remote business.
The next question comes from Jonathan Goldman with Scotiabank. Please go ahead.
Hey, good morning team, and thanks for taking my questions. Just a couple housekeeping ones from me. Can you give us an update on how big your camps business is in support services today, and how much of it is exposed to mining versus oil and gas versus infrastructure and others? Just curious how big that business is today. Thanks.
Morning, Jonathan. Just in terms of your first question, our camps business, that would be the ABS as well as support services components of that is about CAD 600 million. Of that, it kind of breaks down to about 40% of that energy, oil and gas, 30% mining, about 30% infrastructure.
Okay. Thanks for that.
Again, you can...
Sorry, go ahead.
Yeah. Over the last few years, we've really been diversifying. If you looked at this a few years ago, it would've been, you know, probably a lot more, over 50% oil and gas. You know, we've been very deliberately kind of diversifying not only just east-west but also across various industries as well.
Got it. Secondly, how should we think about a normalized run rate for PBC equity income in 2026?
When we issued the press release and announced the acquisition, we did give, you know, some high-level historical numbers around, you know, revenues are about $170 million U.S. Again, it's an IFM FM business, so margins on that would be kind of in or around 8%-8%. Using that, with our 40% ownership can give you an idea as to what we're expecting. You can build some, a little bit of growth obviously, because we're, as we've mentioned, we're focused on growing our U.S. platform and, partnering with PBC for that. Expecting some growth in 2026 on those numbers as well.
As a reminder, to ask a question, please press star then one to join the question queue. The next question comes from Zachary Evershed with National Bank Financial. Please go ahead.
Hey again. Just double-clicking on the nation building tailwind. Some of the workforce accommodation peers are indicating that those could hit the P&L later in 2026 or early in 2027. Can you comment on your pipeline, any RFPs that you're seeing right now in terms of timing?
Yeah, I think it would be kind of across the spectrum is what I would say, Zach. I think we've got some near-term things, you know, Ksi Lisims LNG project, PRGT pipeline, which I know you're well aware that are flagging more near-term, near-term timing. you know, we're seeing other things that are further out in timing. I would almost say, again, we gotta see these things play out. We gotta see these things come to bear. We've got kind of a spectrum of near term, meaning things that you might see some proceeds in 2026, and then picking up more in 2027, 2028 is what we're seeing.
Certainly kind of a full spectrum of projects, you know, right all the way from, you know, LNG, oil and gas, pipeline as certainly mining for sure. Then, the government, the government side as well.
Good. Got it. Thanks. Then on the economics, what's it looking like for purchasing new build workforce accommodation equipment versus rack rates? Is it getting closer to making sense for intervention?
Yeah, I think, you know, we still have to, you know, new build is still a very expensive proposition in Canada. There is equipment available, and I did flag it as part of my comments. There is market equipment available and, you know, Zach, I think you know, we do focus on higher quality equipment. We're a higher quality provider of workforce accommodations equipment. There is equipment out there that is, you know, higher quality that we can get through the market. A little bit of refurb that really just falls within our current numbers. We can bring that to bear. I think for us, our first place we're gonna go is kind of market equipment before we start looking at anything related to new build is what I would say.
Betsy, are you there? Hello? Okay. I think we've got all of our questions covered and I'm hearing there's no more questions in the queue. We'll wrap it up today and thanks everyone for joining.