MONTREAL — Flight simulator maker CAE Inc. stands to grow with a global upswing in military spending, chief executive Marc Parent said Wednesday as the company reported its latest quarterly results.
Parent pointed to increasing defence budgets across NATO and allied countries, including a notably stronger commitment from Canada.
"Increasing defence budgets are driving demand for the advanced training and simulation solutions where CAE has a clear competitive differentiation," Parent told a conference call with financial analysts.
The increase in military spending comes as U.S. President Donald Trump casts doubt on the future of the NATO military alliance.
During the election campaign, Prime Minister Mark Carney pledged to increase Canada's defence spending to the two per cent NATO target by 2030.
The European Commission has also unveiled a plan to provide loans and allow member states to take on more debt to spend on defence, without triggering the restrictions the EU imposes on members with excessive deficits.
"Any capability that they deploy, whether it's new aircraft, it's new helicopters, it's new ships, it's new submarines, all that is going to require very significant and realistic training. So as Canada's strategic partner, you know, I think we were going to continue to do very well in that market," Parent said.
CAE was named in February a strategic partner to work with the Royal Canadian Air Force to design and co-develop the Future Fighter Lead-in Training program, which will prepare and train pilots to operate Canada’s advanced fighters.
In May 2024, CAE announced that SkyAlyne, its joint venture with KF Aerospace, won a $11.2-billion, 25-year contract for Canada’s Future Aircrew Training Program.
After the close of trading Tuesday, CAE reported a fourth-quarter profit attributable to equity holders of $135.9 million or 42 cents per share for the quarter ended March 31. The result compared with a loss of $504.7 million or $1.58 per share in the same quarter last year.
On an adjusted basis, CAE says it earned 47 cents per share in its latest quarter compared with an adjusted profit of 12 cents per share a year earlier.
Revenue for the quarter totalled $1.28 billion, up from $1.13 billion.
The increase came as civil aviation revenue amounted to $728.4 million, up from $700.8 million a year earlier, while defence and security revenue totalled $547 million, up from $425.5 million.
This report by The Canadian Press was first published May 14, 2025.
Companies in this story: (TSX:CAE)
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