Black Diamond Group Limited

Black Diamond reported Q2 2026 consolidated revenue of $129.2 million, up 23% year over year, and adjusted EBITDA of $30.4 million, up 4%. EPS was $0.01 versus $0.15 in the prior-year quarter, while adjusted EPS was $0.09 versus $0.18. Consolidated rental revenue increased 17% to $45 million, contracted future rental revenue ended at $136.5 million, free cash flow was $14.6 million, and funds from operations were $28.6 million. Capital expenditures were $24.9 million, down 23%, and capital commitments were $34.2 million, up 24%. Net debt was $351 million, with net debt-to-trailing-12-month adjusted EBITDA of 2.4x; the ABL facility was expanded to $550 million, lifting available liquidity to nearly $200 million. Segmentally, WFS revenue was $72.2 million, up 55%, with adjusted EBITDA of $15.6 million, up 3%; MSS rental revenue was $28.6 million, up 8%, with adjusted EBITDA of $20.9 million, up 3%. Management said the margin moderation was mainly from the higher lodging mix after Royal Camp, and they expect CapEx to accelerate in the back half of 2026 based on demand. No formal next-quarter or full-year numeric guidance was given.

Trevor Haynes framed the quarter as evidence of stability across the platform and said the company is entering the second half with confidence. He highlighted the Royal Camp acquisition as strategically important, saying it positions Black Diamond as a leading integrated remote accommodations platform and broadens its service offering. He also emphasized the ERP implementation being completed on time and on budget, and repeatedly pointed to a strong pipeline across WFS, MSS, and LodgeLink as the basis for future growth.

Toby LaBrie focused on the financial bridge: EPS and adjusted EPS were lower because of the shift toward lower-margin lodging revenue, plus higher depreciation, interest, and share count from Royal. He noted a $3.6 million charge tied to BC sales tax assessments, which the company is appealing and is trying to recover from customers. On the balance sheet, he highlighted $351 million of net debt, 2.4x leverage, the $550 million ABL facility, and nearly $200 million of liquidity, while saying working capital should normalize after the ERP go-live.

Analysts pressed on CapEx, WFS utilization, bid timing, pricing, and whether demand is broad-based or concentrated in one industry. Management said most growth CapEx is currently in MSS, WFS capacity remains ample, and the WFS opportunity is spread across mining, LNG, data centers, defense, infrastructure, and oil/gas rather than one vertical. They also said WFS bid rates are up about 50% from the trough, but still below levels that would justify major new camp-build CapEx, and that smaller projects are starting to move first while larger projects could drive step-changes later.