EX-99.1 2 alithyagroupfsenglishq32026.htm EX-99.1 Document


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Interim Condensed Consolidated
Financial Statements
of Alithya Group inc.

For the three and nine months ended December 31, 2025 and 2024
(unaudited)
Exhibit 99.1


TABLE OF CONTENTS
Interim Consolidated Statements of Operations and Comprehensive Loss
Interim Consolidated Statements of Cash Flows
Notes to Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
1.
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3.
4.
5.
6.
7.
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10.
Earnings (loss) per share
11.
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16.

INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
For the three months ended December 31,For the nine months ended December 31,
(in thousands of Canadian dollars, except per share data) (unaudited)2025202420252024
Notes$$$$
Revenues15115,162 115,761 363,612 348,150 
Cost of revenues1178,648 78,376 244,525 238,107 
Gross margin36,514 37,385 119,087 110,043 
Operating expenses
Selling, general and administrative expenses1128,460 28,814 90,329 86,342 
Business acquisition, integration and reorganization costs (recovery)12(372)(1,244)(2,210)88 
Depreciation11668 1,168 2,711 3,365 
Amortization of intangibles44,125 4,810 14,397 14,089 
Impairment of goodwill and intangibles
4,5
— 5,144 38,028 5,144 
Foreign exchange loss (gain)581 (687)1,278 (445)
33,462 38,005 144,533 108,583 
Operating income (loss)3,052 (620)(25,446)1,460 
Net financial expenses132,339 2,372 7,305 6,246 
Earnings (loss) before income taxes713 (2,992)(32,751)(4,786)
Income tax expense (recovery)
Current1,503 479 2,291 778 
Deferred(1,466)245 (4,942)1,184 
37 724 (2,651)1,962 
Net earnings (loss)676 (3,716)(30,100)(6,748)
Other comprehensive (loss) income
Items that may be classified subsequently to profit or loss
Cumulative translation adjustment on consolidation of foreign subsidiaries(778)2,918 (2,153)3,133 
(778)2,918 (2,153)3,133 
Comprehensive loss(102)(798)(32,253)(3,615)
Basic and diluted earnings (loss) per share100.01 (0.04)(0.31)(0.07)
The accompanying notes are an integral part of these interim condensed consolidated financial statements.
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
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INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
As atDecember 31,March 31,
(in thousands of Canadian dollars) (unaudited)20252025
Notes$$
Assets
Current assets
Cash12,944 15,956
Accounts receivable and other receivables76,982 95,270
Unbilled revenues24,624 14,803
Tax credits receivable8,855 10,996
Prepaids 7,176 8,680 
130,581 145,705 
Non-current assets
Tax credits receivable6,500 9,979
Other assets1,113 1,327 
Property and equipment3,821 3,960
Right-of-use assets2,952 4,277
Intangibles463,915 74,450
Deferred tax assets5,441 4,875
Goodwill5159,630 181,407
373,953 425,980
Liabilities and Shareholders' Equity
Current liabilities
Accounts payable and accrued liabilities64,691 80,899 
Deferred revenues21,258 25,024
Current portion of lease liabilities1,793 3,546
Current portion of long-term debt78,318 8,059
Current portion of contingent consideration61,519 — 
97,579 117,528
Non-current liabilities
Contingent consideration61,276 5,359
Long-term debt7106,491 101,860
Lease liabilities4,598 5,449
Deferred tax liabilities8,611 11,228
218,555 241,424
Shareholders' equity
Share capital8317,702 316,685
Deficit(183,336)(155,075)
Accumulated other comprehensive income5,845 7,998
Contributed surplus15,187 14,948
155,398 184,556
373,953 425,980
The accompanying notes are an integral part of these interim condensed consolidated financial statements.
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
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INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
For the nine months ended December 31,
(in thousands of Canadian dollars, except share data) (unaudited)
NotesShares
issued		Share capitalDeficitAccumulated other
comprehensive
income		Contributed
surplus		Total
Number$$$$$
Balance as at March 31, 202599,305,100 316,685 (155,075)7,998 14,948 184,556 
Net loss— — (30,100)— — (30,100)
Other comprehensive loss— — — (2,153)— (2,153)
Total comprehensive loss— — (30,100)(2,153)— (32,253)
Share-based compensation9— — — — 3,117 3,117 
Share-based compensation granted on business acquisitions9— — — — 1,217 1,217 
Issuance of Subordinate Voting Shares pursuant to vesting of share-based compensation granted on business acquisitions8622,420 1,966 — — (1,966)— 
Issuance of Multiple Voting Shares from exercise of stock options
8,9
52,632 178 — — (78)100 
Issuance of Subordinate Voting Shares upon settlement of DSUs
8,9
256,191 620 — — (620)— 
Shares purchased for cancellation8(347,160)(1,176)567 — — (609)
Shares purchased for settlement of RSUs8(84,470)(286)81 — — (205)
Delivery of Subordinate Voting Shares upon settlement of RSUs8,984,470 197 — — (269)(72)
Change from equity-settled to cash-settled DSUs— — — — (453)(453)
Forfeiture and cancellation of PSUs— — 709 — (709)— 
Shares cancelled 8(142,318)(482)482 — — — 
Total contributions by shareholders441,765 1,017 1,839 — 239 3,095 
Balance as at December 31, 202599,746,865 317,702 (183,336)5,845 15,187 155,398 
Balance as at March 31, 202495,415,248 312,409 (157,370)4,606 15,559 175,204 
Net loss— — (6,748)— — (6,748)
Other comprehensive income— — — 3,133 — 3,133 
Total comprehensive (loss) income— — (6,748)3,133 — (3,615)
Share-based compensation— — — — 2,448 2,448 
Share-based compensation granted on business acquisitions— — — — 964 964 
Share-based compensation related to contingent consideration adjustment, granted on Datum Acquisition, to be settled in shares— — — — (642)(642)
Issuance of Subordinate Voting Shares pursuant to vesting of share-based compensation granted on business acquisition622,420 1,971 — — (1,971)— 
Issuance of Subordinate Voting Shares pursuant to the XRM Acquisition3,449,103 2,875 — — — 2,875 
Shares purchased for cancellation(205,483)(717)315 — — (402)
Cash settlement of DSUs issued as share-based compensation— — 20 — (107)(87)
Shares purchased for settlement of RSUs(69,840)(244)96 — — (148)
Delivery of Subordinate Voting Shares upon settlement of RSUs69,840 169 — — (266)(97)
Issuance of Subordinate Voting Shares upon settlement of PSUs23,812 222 245 — (521)(54)
Cash settlement of PSUs issued as share-based compensation— — 274 — (346)(72)
Total contributions by, and distributions to, shareholders3,889,852 4,276 950 — (441)4,785 
Balance as at December 31, 202499,305,100 316,685 (163,168)7,739 15,118 176,374 
The accompanying notes are an integral part of these interim condensed consolidated financial statements.
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
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INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
For the three months ended December 31,For the nine months ended December 31,
(in thousands of Canadian dollars) (unaudited)2025202420252024
Notes$$$$
Operating activities
Net earnings (loss)676(3,716)(30,100)(6,748)
Adjustments for:
Depreciation and amortization4,7935,97817,10817,454
Contingent consideration adjustment12—(2,738)—(2,738)
Change in fair value of contingent consideration12(914)—(5,086)—
Net financial expenses132,3392,3727,3056,246
Share-based compensation91,3171,3754,3233,412
Unrealized foreign exchange loss (gain)1,449(447)2,186(564)
Realized foreign exchange (gain) loss on repayment of long-term debt(360)98(817)224
Impairment of goodwill and intangibles
4,5
—5,14438,0285,144
Loss on disposal of property and equipment, intangible and lease modification11273—518—
Deferred taxes(1,466)245(4,942)1,184
8,1078,31128,52323,614
Changes in non-cash working capital items1417,3673,374(6,168)7,749
Net cash from operating activities25,47411,68522,35531,363
Investing activities
Additions to property and equipment(384)(146)(1,008)(754)
Additions to intangibles4(181)(141)(278)(205)
Business acquisitions, net of cash acquired
3,14
(1,348)(6,382)(10,842)(6,382)
Net cash used in investing activities(1,913)(6,669)(12,128)(7,341)
Financing activities
Advances on the Credit Facility, net of related transaction costs9,00022,99952,38589,331
Repayment of the Credit Facility(30,021)(22,878)(46,675)(85,051)
Repayment of secured loans———(8,537)
Repayment of balances of purchase price payable(3,450)—(7,712)(4,268)
Repayment of other long-term debt(87)(362)(262)(362)
Repayment of lease liabilities, including lease termination costs(1,053)(960)(3,318)(3,672)
Settlement of RSUs and PSUs, including witholding taxes paid9(12)(310)(72)(310)
Exercise of stock options8——100—
Shares purchased for settlement of RSUs8(10)(10)(205)(148)
Shares purchased for cancellation8(559)—(609)(402)
Financial expenses paid13(1,981)(2,200)(6,245)(5,810)
Net cash used in financing activities(28,173)(3,721)(12,613)(19,229)
Effect of exchange rate changes on cash(253)369(626)441
Net change in cash(4,865)1,664(3,012)5,234
Cash, beginning of period17,80912,42915,9568,859
Cash, end of period12,94414,09312,94414,093
Cash paid (included in cash flow from operating activities)
Income taxes paid 6652792,042638
The accompanying notes are an integral part of these interim condensed consolidated financial statements.
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
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NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
1. GOVERNING STATUTES AND NATURE OF OPERATIONS
Alithya Group inc. (together with its subsidiaries, “Alithya” or the “Company”) is a professional services firm providing IT services and solutions through the optimal use of digital technologies in the areas of strategic consulting, enterprise transformation and business enablement.
The Company’s Class A subordinate voting shares (the “Subordinate Voting Shares”) trade on the Toronto Stock Exchange (“TSX”) under the symbol “ALYA”.
The Company’s head office is located at 700, René Lévesque West Blvd, Suite 400, Montréal, Québec, Canada, H3B 1X8.
2. BASIS OF PREPARATION
Statement of Compliance
These interim condensed consolidated financial statements have been prepared in accordance with IAS 34 - Interim Financial Reporting. They do not include all of the information required in annual financial statements in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board, and should be read in conjunction with the annual audited consolidated financial statements for the year ended March 31, 2025. The Company applied the accounting policies adopted in its most recent annual audited consolidated financial statements for the year ended March 31, 2025, except for changes as detailed below.
These interim condensed consolidated financial statements were approved and authorized for issue by the Board of Directors (the “Board”) on February 12, 2026.
Basis of Measurement
These interim condensed consolidated financial statements have been prepared under the historical cost basis except for:
•Identifiable assets acquired and liabilities and contingent liabilities resulting from a business acquisition, which are generally measured initially at their fair values at the acquisition date and contingent purchase considerations which are measured at the acquisition date and subsequently at fair value;
•Lease obligations, which are initially measured at the present value of the lease payments that are not paid at the lease commencement date;
•Equity classified share-based payment arrangements which are measured at fair value at grant date pursuant to IFRS 2, Share-Based Payment; and
•Liabilities for cash-settled share-based payment arrangements which are initially and subsequently measured at fair value.
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
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NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
2. BASIS OF PREPARATION (CONT’D)
NEW ACCOUNTING STANDARDS AND INTERPRETATIONS ISSUED BUT NOT YET EFFECTIVE
At the date of authorization of these interim condensed consolidated financial statements, certain new standards, amendments and interpretations, and improvements to existing standards have been published by the IASB but are not yet effective and have not been adopted early by the Company. Management anticipates that all the relevant pronouncements will be adopted in the first reporting period following the date of application. Information on new standards, amendments and interpretations, and improvements to existing standards, which could potentially impact the Company’s consolidated financial statements, are detailed as follows:
IFRS 7 and IFRS 9 - Classification and measurement of Financial Instruments
In May 2024, the IASB issued amendments to IFRS 9 – Financial Instruments and IFRS 7 – Financial Instruments: Disclosures. The standard amendments clarify the date of recognition and derecognition of some financial assets and liabilities, with a new exception for some financial liabilities settled through an electronic cash transfer system. Furthermore, they clarify the description of non-recourse assets and contractually linked instruments and they introduce additional disclosures for financial instruments with contractual terms that can change cash flows, and equity instruments classified at fair value through other comprehensive income. The amendments to IFRS 7 and IFRS 9 apply retrospectively and are effective for annual periods beginning on or after January 1, 2026, with earlier application permitted. The amendments to IFRS 7 and IFRS 9 will have no significant impact on the Company’s consolidated financial statements.
IFRS 18 - Presentation and Disclosures in Financial Statements
On April 9, 2024, the IASB published the new IFRS 18 – Presentation and Disclosures in Financial Statements that will replace IAS 1 – Presentation of Financial Statements.
IFRS 18 covers four main areas:
•Introduction of defined subtotals and categories in the statement of profit or loss;
•Introduction of requirements to improve aggregation and disaggregation;
•Introduction of disclosures about management-defined performance measures (MPMs) in the notes to the financial statements; and
•Targeted improvements to the statement of cash flows by amending IAS 7 – Statement of Cash Flows.
IFRS 18 applies retrospectively and is effective for annual periods beginning on or after January 1, 2027, with earlier application permitted. Management is currently evaluating the impact of the new accounting standard on its consolidated financial statements.
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
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NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
3. BUSINESS ACQUISITION
eVerge
Overview
On May 31, 2025, the Company acquired all of the issued and outstanding shares of U.S.-based eVerge Interests, Inc. and its subsidiaries (“eVerge”) (the “eVerge Acquisition”), a group specialized in enterprise applications and transformation services. Management expects that eVerge’s expertise will complement its existing Oracle business, will increase its AI capabilities, and will reinforce it’s smart shoring capabilities.
The eVerge Acquisition was completed for total consideration of US$23,500,000 ($32,292,000), before working capital and other adjustments, all payable in cash.
The total purchase consideration, in the amount of US$20,640,000 ($28,363,000) once adjusted for working capital and other adjustments, consisted of: (i) US$7,557,000 ($10,385,000) paid in cash on closing; (ii) US$283,000 ($389,000) of final working capital adjustment (iii) US$580,000 ($797,000) of holdback, included in accounts payable and accrued liabilities; (iv) US$7,520,000 ($10,334,000) of balance of sale payable in two installments of US$3,760,000 ($5,167,000) on May 31st, 2026 and 2027 (each an "Anniversary Date"); and (v) potential earn-out consideration of US$4,700,000 ($6,458,000), payable in two installments (50% within 90 days of the first Anniversary Date and 50% on the second Anniversary Date).
The total earn-out consideration of US$4,700,000 ($6,458,000) is contingent upon the future financial performance of the acquired business over the 12-month period following the acquisition date. The contingent consideration included in the purchase consideration is classified as a financial liability recorded at fair value through profit and loss and comprised an undiscounted scenario-based weighted average expected payout amount. The contingent consideration liability is included in Level 3 of the fair value hierarchy and will be remeasured at fair value at each reporting date. The fair value was determined using a scenario-based method, under which the Company identifies multiple outcomes, probability-weights the contingent consideration payoff under each outcome, and discounts the result to arrive at the expected present value of the contingent consideration. At acquisition date, the discount rate used was 17.8%.
For the three and nine months ended December 31, 2025, the Company incurred acquisition-related costs pertaining to the eVerge Acquisition of approximately nil and $883,000, respectively. These costs have been recorded in the interim consolidated statement of operations in business acquisition, integration and reorganization costs.
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
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NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
3. BUSINESS ACQUISITION (CONT’D)
Purchase Price Allocation

The allocation of the fair value of the assets acquired and the liabilities assumed is detailed as follows:
Acquisition of eVerge
As at
December 31, 2025
Preliminary at acquisition dateAdjustments
$$$
Current assets
Cash843 891 (48)
Accounts receivable and other receivables5,416 5,376 40 
Prepaids342 339 3 
6,601 6,606 (5)
Non-current assets
Property and equipment62 62 — 
Intangibles (note 4)
6,895 7,376 (481)
Goodwill (note 5)
18,604 20,025 (1,421)
Total assets acquired32,162 34,069 (1,907)
Current liabilities
Accounts payable and accrued liabilities6,430 6,448 (18)
Income taxes payable69 31 38 
Deferred revenue524 431 93 
7,023 6,910 113 
Non-current liabilities
Deferred tax liabilities1,820 1,948 (128)
Total liabilities assumed8,843 8,858 (15)
Net assets acquired23,319 25,211 (1,892)
As at December 31, 2025, upon completion of the purchase price allocation, the determination of the fair value of intangible assets and earn-out consideration, closing adjustments and related deferred tax considerations have been completed. The goodwill adjustment resulted primarily from adjustments to the fair value of the intangibles and the earn-out consideration.
The eVerge Acquisition is being accounted for using the acquisition method of accounting.
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
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NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
3. BUSINESS ACQUISITION (CONT’D)
Goodwill
The goodwill recognized consists mainly of the future economic value attributable to the profitability of the acquired business, as well as its workforce and expected synergies from the integration of eVerge into the Company's existing business. The Company does not expect the goodwill to be deductible for income tax purposes.
Purchase consideration
The following table summarizes the acquisition date fair value of each class of purchase consideration as follows:
Acquisition of eVerge
As at
December 31, 2025
Preliminary at acquisition dateAdjustments
$$$
Cash consideration10,385 10,385 — 
Working capital adjustment settled in cash389 — 389 
Holdback presented in accounts payable and accrued liabilities (a)
797 797 — 
Balance of purchase price payable with a nominal value of US$7,520,000 ($10,334,000) (note 7) (b)
9,214 9,214 — 
Contingent consideration of US$4,700,000 ($6,458,000), recorded at fair value (b)
2,534 4,815 (2,281)
Total purchase consideration23,319 25,211 (1,892)
(a) As at December 31, 2025, $279,000 of the holdback has been used.
(b) Non-cash financing activities
eVerge’s contribution to the Company’s results
For the three months ended December 31, 2025, the eVerge business contributed revenues of approximately $7,027,000 and a loss before income taxes in the amount of $867,000, including amortization, primarily related to the acquired customer relationships, of $763,000, integration cost of $291,000 and interest accretion of $186,000.
For the nine months ended December 31, 2025, the eVerge business contributed revenues of approximately $18,703,000, and a loss before income taxes in the amount of $2,072,000, including amortization, primarily related to the acquired customer relationships, of $3,245,000, integration cost of $386,000, change in fair value of contingent consideration of $272,000, interest accretion of $426,000 and business acquisition costs of $883,000 (note 12).
If the acquisition had occurred on April 1, 2025, the Company’s pro-forma consolidated revenues and loss before income taxes would have been $369,865,000 and $32,918,000, respectively, for the nine months ended December 31, 2025. These amounts have been calculated using eVerge’s results and adjusting for:
•differences in accounting policies between the Company and eVerge;
•the removal of transaction costs incurred by eVerge from April 1, 2025 to May 31, 2025; and
•the additional amortization that would have been charged assuming the fair value adjustments to intangibles had been applied from April 1, 2025.
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
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NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
4. INTANGIBLES
As atDecember 31, 2025March 31, 2025
Customer relationshipsSoftware
Tradenames (a)
Non-compete agreementsTotalCustomer
relationships		Software
Tradenames (a)
Non-compete agreementsTotal
$$$$$$$$$$
Opening cost175,492 16,833 3,020 8,806 204,151 163,297 15,866 2,844 7,738 189,745 
Additions, purchased— — — — — — 116 — — 116 
Additions through business acquisition (note 3)
6,527 24 — 344 6,895 7,800 300 — 1,600 9,700 
Additions, internally generated— 278 — — 278 — 123 — — 123 
Disposals / retirements(3,058)(46)— (6,289)(9,393)(424)(338)— (810)(1,572)
Foreign currency translation adjustment(3,962)(631)(144)(228)(4,965)4,819 766 176 278 6,039 
Ending cost174,999 16,458 2,876 2,633 196,966 175,492 16,833 3,020 8,806 204,151 
Opening accumulated amortization107,441 15,206 — 7,054 129,701 91,530 10,578 — 6,364 108,472 
Amortization12,841 1,193 — 363 14,397 13,321 4,361 — 1,244 18,926 
Impairment loss (note 5)1,072 — 733 — 1,805 — — — — — 
Disposals / retirements(3,058)— — (6,289)(9,347)(424)(338)— (810)(1,572)
Foreign currency translation adjustment(2,695)(587)(7)(216)(3,505)3,014 605 — 256 3,875 
Ending accumulated amortization115,601 15,812 726 912 133,051 107,441 15,206 — 7,054 129,701 
Net carrying amount59,398 646 2,150 1,721 63,915 68,051 1,627 3,020 1,752 74,450 
(a) Tradenames are allocated to the Industry Solutions cash-generating unit (“CGU”) for the purpose of impairment testing.
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
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NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
5. GOODWILL
As atDecember 31, 2025
CanadaFranceEPM-USERP-USERP-CAN
Industry Solutions
Not allocatedTotal
$$$$$$$$
Beginning balance78,405 143 10,196 67,893 — 10,108 14,662 181,407 
Allocation (a)
— — — — 14,662 — (14,662)— 
Business acquisition (note 3)
— — 18,604 — — — — 18,604 
Impairment loss(26,500)— — — — (9,723)— (36,223)
Foreign currency translation adjustment— 4 (548)(3,229)— (385)— (4,158)
Net carrying amount51,905 147 28,252 64,664 14,662 — — 159,630 
As atMarch 31, 2025
CanadaFranceEPM-USERP-USERP-CAN
Industry Solutions
Not allocatedTotal
$$$$$$$$
Beginning balance78,405 135 9,603 63,941 — 14,409 — 166,493 
Business acquisition— — — — — — 14,662 14,662 
Impairment loss— — — — — (5,144)— (5,144)
Foreign currency translation adjustment— 8 593 3,952 — 843 — 5,396 
Net carrying amount78,405 143 10,196 67,893 — 10,108 14,662 181,407 
(a) During the nine months ended December 31, 2025, upon completion of the purchase price allocation, the Company allocated the goodwill from the acquisition of XRM Vision Inc. and its affiliates (the “XRM Acquisition”) to the ERP-CAN CGU for the purpose of impairment testing. There were no other changes to the purchase price allocation.
The carrying amounts of the Company's goodwill are reviewed for impairment when events or changes in circumstances indicate that the carrying value may be impaired. At each reporting date, the Company assesses whether there is any indication of impairment. During the three months ended September 30, 2025, management concluded that profitability targets not being achieved for the Canada and Industry Solutions CGUs constituted an indication of impairment. Consequently, management performed impairment tests for the Canada and Industry Solutions CGUs. In assessing whether the goodwill is impaired, the carrying amount of the CGU was compared to its recoverable amount. The recoverable amount of the CGU is based on the higher of the value in use and fair value less costs of disposal.
The recoverable amount of the Canada and Industry Solutions CGUs were determined based on their value-in-use. The value-in-use calculations covered a forty-two months forecast, followed by an extrapolation of future expected net operating cash flows for the remaining useful lives using the long-term growth rate determined by management. The present value of the future expected operating cash flows is determined by applying a suitable pre-tax weighted average cost of capital (“WACC”) reflecting current market assessments of the time value of money and the CGU-specific risks.

Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
| 12
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
5. GOODWILL (CONT'D)
Key assumptions used in the impairment testing of the Canada and Industry Solutions CGUs were as follows:
As atSeptember 30, 2025March 31, 2025
CanadaIndustry SolutionsCanadaIndustry Solutions
%%%%
Pre-tax WACC14.4 14.1 14.0 17.5 
Long-term growth rate of net operating cash flows2.02.21.9 2.1 
As a result of the impairment tests performed, management concluded that the recoverable amount of the Canada and Industry Solutions CGUs were less than their carrying amount, resulting in an impairment of goodwill of $26,500,000 and $9,723,000, respectively, and an impairment of intangibles of $1,805,000 for the Industry Solutions CGU as at September 30, 2025.
Varying the key assumptions in the values of the recoverable amount calculations, individually, as indicated below, assuming all other variables remain constant, would have the following effects on the net earnings:
As atSeptember 30, 2025
IncreaseDecrease
$$
Canada
After-tax WACC (1% movement (100 basis points))(16,310)20,401 
Long-term growth rate of net operating cash flows (1% movement (100 basis points))15,788 (12,753)
Furthermore, a decrease of 5% of the forty-two months forecasts would result in the increase of impairment in the amount of $8,149,000 for the Canada CGU.
6. CONTINGENT CONSIDERATION
The following table presents information concerning contingent consideration activity for the period:
As atDecember 31,March 31,
20252025
$$
Beginning balance5,359 4,082 
Business acquisition (note 3)2,534 5,104 
Change in fair value (note 12)(5,086)— 
Recovery from change in estimate— (4,056)
Foreign currency translation adjustment(12)229 
2,795 5,359 
Current portion of contingent consideration1,519 — 
1,276 5,359 
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
| 13
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
7. LONG-TERM DEBT
The following table summarizes the Company’s long-term debt:
As atDecember 31,March 31,
20252025
$$
Senior secured revolving credit facility (the "Credit Facility") (a)
80,571 77,729 
Subordinated unsecured loans (b)
20,000 20,000 
Balance of purchase price payable with a nominal value as at March 31, 2025 of US$3,115,000 ($4,479,000), non-interest bearing (4.4% effective interest rate), matured on July 1, 2025
— 4,431 
Balance of purchase price payable with a nominal value of $5,175,000 (March 31, 2025 - $8,625,000), non-interest bearing (8.0% effective interest rate), payable in annual installments of $3,450,000 for the first and second anniversaries, and $1,725,000 for the third anniversary, maturing on December 1, 2027
4,703 7,718 
Balance of purchase price payable with a nominal value of US$7,520,000 ($10,299,000), non-interest bearing (8.0% effective interest rate), payable in annual installments of US$3,760,000 ($5,149,000), maturing on May 31, 2027 (note 3)
9,604 — 
Other debt 117 379 
Unamortized transaction costs (net of accumulated amortization of $287,000 and $403,000)
(186)(338)
114,809 109,919 
Current portion of long-term debt8,318 8,059 
106,491 101,860 
(a) The Credit Facility is available to a maximum amount of $140,000,000 which can be increased under an accordion provision to $190,000,000, under certain conditions, and can be drawn in Canadian dollars and the equivalent amount in U.S. dollars. It is available in prime rate advances, CORRA advances, SOFR advances and letters of credit of up to $2,500,000.
The advances bear interest at the Canadian or U.S. prime rate, plus an applicable margin ranging from 0.75% to 1.75%, or CORRA or SOFR rates, plus an applicable margin ranging from 2.00% to 3.00%, as applicable for Canadian and U.S. advances, respectively. The applicable margin is determined based on certain financial ratios. As security for the Credit Facility, Alithya provided a first ranking hypothec on the universality of its assets excluding any leased equipment and Investissement Québec’s first ranking lien on tax credits receivable for the financing related to refundable tax credits. Under the terms of the agreement, the Company is required to maintain certain financial covenants which are measured on a quarterly basis.
The Credit Facility matures on April 1, 2027 and is renewable for additional one-year periods at the lender’s discretion, provided that the term of the Credit Facility never exceeds three years at a given time.
As at December 31, 2025, the amount outstanding under the Credit Facility includes $50,671,000 (March 31, 2025 - $61,829,000) payable in U.S. dollars (US$37,000,000; March 31, 2025 - US$43,000,000).
The Company has an additional operating credit facility available to a maximum amount of $2,739,000 (US$2,000,000), bearing interest at the U.S. prime rate plus 1.00%. This operating credit facility can be terminated by the lender at any time. There was no amount outstanding under this additional operating credit facility as at December 31, 2025.
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
| 14
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
7. LONG-TERM DEBT (CONT’D)
(b) The subordinated unsecured loans with Investissement Québec, in the amount of $20,000,000, mature on October 1, 2027 and are renewable for one additional year at the lender’s discretion. For the period up to November 1, 2025, the first $10,000,000 bears fixed interest rates ranging between 6.00% and 7.25% and the additional $10,000,000 bears interest ranging between 7.10% and 8.35%, determined and payable quarterly, based on certain financial ratios. Starting November 1, 2025, the total amount of $20,000,000 bears variable interest rate at Canadian prime rate, plus an applicable margin ranging from 3.21% to 4.46%, determined and payable quarterly based on certain financial ratios.
Under the terms of the loans, the Company is required to maintain compliance with certain financial covenants which are measured on a quarterly basis.
(a)(b) The Company was in compliance with all of its financial covenants as at December 31, 2025 and March 31, 2025.
8. SHARE CAPITAL
The following table presents information concerning issued share capital activity for the period:
Subordinate Voting SharesMultiple Voting Shares
Number of shares$Number of shares$
Beginning balance as at April 1, 202592,030,852 311,861 7,274,248 4,824 
Shares issued pursuant to vesting of share-based compensation granted on business acquisition622,420 1,966 — — 
Exercise of stock options— — 52,632 178 
Shares purchased for cancellation(347,160)(1,176)— — 
Settlement of DSUs256,191 620 — — 
Shares purchased for settlement of RSUs(84,470)(286)— — 
Delivery of shares upon settlement of RSUs84,470 197 — — 
Shares cancelled (142,318)(482)— — 
Ending balance as at December 31, 2025 (a)
92,419,985 312,700 7,326,880 5,002 
(a) Includes 1,149,702 Subordinate Voting Shares issued as part of the XRM Acquisition subject to forfeitures which are not considered as outstanding as per IFRS.
During the nine months ended December 31, 2025, the following transactions occurred:
•As part of the acquisition of Datum Consulting Group, LLC and its international affiliates (the “Datum Acquisition’’), 622,420 Subordinate Voting Shares, with a total value of $1,966,000 (US$1,438,000), reclassified from contributed surplus, were issued as settlement of the third anniversary share consideration.
•52,632 stock options were exercised and 52,632 Multiple Voting Shares were issued with a carrying value of $178,000, for cash consideration of $100,000, with $78,000 reclassified from contributed surplus.
•347,160 Subordinate Voting Shares were purchased for cancellation under the Company's normal course issuer bid for a total cash consideration of $609,000 and a carrying value of $1,176,000. The excess of the carrying value over the purchase price in the amount of $567,000 was recorded as a reduction to deficit.
•256,191 DSUs were settled and 256,191 Subordinate Voting Shares were issued with a carrying value of $620,000, which was reclassified from contributed surplus.
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
| 15
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
8. SHARE CAPITAL (CONT’D)
•84,470 Subordinate Voting Shares were purchased on the open market in connection with the settlement of RSUs for a total cash consideration of $205,000 and a carrying value of $286,000. The excess of the carrying value over the purchase price in the amount of $81,000 was recorded as a reduction to deficit. A total of 116,567 RSUs were settled net of withholding tax and 84,470 Subordinate Voting Shares were delivered with a carrying value of $197,000, which was reclassified from contributed surplus. The purchase and delivery of Subordinate Voting Shares upon settlement of RSUs were completed by the administrative agent of the Share Unit Plan (“SUP”), in accordance with the terms of the SUP and the Services Agreement entered into between the Company and the administrative agent.
•142,318 Subordinate Voting Shares were cancelled in accordance with the application of a sunset clause as per the November 1, 2018 agreement with Edgewater Technology, Inc., with a carrying value of $482,000 reclassified to deficit.
Normal Course Issuer Bid ("NCIB")
On September 9, 2025, the Company’s Board of Directors authorized and subsequently the TSX approved the implementation of a NCIB. Under the NCIB, the Company is allowed to purchase for cancellation up to 5,939,183 Subordinate Voting Shares, representing 10% of the Company’s public float as of the close of markets on September 2, 2025.
The NCIB plan commenced on September 12, 2025 and will end on the earlier of September 11, 2026 and the date on which the Company will have acquired the maximum number of Subordinate Voting Shares allowable under the NCIB or will otherwise have decided not to make any further purchases. All purchases of Subordinate Voting Shares are made by means of open market transactions at their market price at the time of acquisition. Concurrently, the Company entered into an automatic share purchase plan (“ASPP”) with a designated broker in connection with its NCIB. The ASPP allows the designated broker to purchase for cancellation Subordinate Voting Shares, on behalf of the Company, subject to certain trading parameters established, from time to time, by the Company.
9. SHARE-BASED COMPENSATION
Stock options
The following table presents information concerning outstanding stock options for the period:
Number of stock options
Weighted average exercise price (a)
$
Beginning balance as at April 1, 20253,547,141 3.29 
Forfeited(34,016)3.25 
Expired(216,000)3.11 
Exercised(52,632)1.90 
Ending balance as at December 31, 20253,244,493 3.32 
Exercisable at period end2,923,126 3.33 
(a) Following the delisting from Nasdaq, the Company converted the U.S. dollar exercise prices in Canadian dollars.
Included in the 2,923,126 stock options exercisable issued, 200,000 stock options are available to purchase Multiple Voting Shares at a weighted average exercise price of $3.38 with a weighted average exercise period of 0.8 year as at December 31, 2025.
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
| 16
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
9. SHARE-BASED COMPENSATION (CONT’D)
Deferred Share Units (“DSUs”)
The following table presents information concerning the outstanding number of DSUs for the period:
Number of DSUs
Beginning balance as at April 1, 20251,471,139 
Granted to non-employee directors300,395 
Granted to employees251,967 
Forfeited(4,493)
Settled(256,191)
Ending balance as at December 31, 20251,762,817 
During the nine months ended December 31, 2025, 300,395 fully vested DSUs, in aggregate, were granted under the Long Term Incentive Plan (“LTIP”) to non-employee directors of the Company at an average grant date fair value of $1.90, per DSU, for an aggregate fair value of $571,000.
During the nine months ended December 31, 2025, 251,967 DSUs, in aggregate, were granted under the SUP at a grant date fair value of $1.91, per DSU, for an aggregate fair value of $481,000. The expense was recorded as at March 31, 2025 as the related services were performed and the performance conditions were met at that date.
As at December 31, 2025, included in the 1,762,817 DSUs are 1,318,292 DSUs issued under the LTIP and 444,525 DSUs issued under the SUP.
Restricted Share Units (“RSUs”)
The following table presents information concerning the outstanding number of RSUs for the period:
Number of RSUs
Beginning balance as at April 1, 20252,155,231 
Granted1,747,743 
Forfeited(572,846)
Settled(116,567)
Ending balance as at December 31, 20253,213,561 
RSUs issued under the SUP are settled in Subordinate Voting Shares purchased on the open market through the SUP’s administrative agent, and to the extent that the Company has an obligation under tax laws to withhold an amount for an employee’s tax obligation associated with the settlement, the Company settles RSUs on a net basis.
During the nine months ended December 31, 2025, 1,747,743 RSUs, in aggregate, vesting in June 2028, were granted under the SUP at an average grant date fair value of $2.29, per RSU, for an aggregate fair value of $4,002,000.
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
| 17
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
9. SHARE-BASED COMPENSATION (CONT’D)
During the nine months ended December 31, 2025, 116,567 RSUs issued under the SUP with a carrying value of $269,000, were settled on a net basis. 84,470 Subordinate Voting Shares were purchased on the open market and delivered, with an amount of $197,000 previously credited to contributed surplus transferred to share capital. The balance of 32,097 RSUs, representing an amount of $72,000, were surrendered for cancellation to satisfy the employee’s statutory withholding tax requirements.
As at December 31, 2025, all 3,213,561 RSUs were issued under the SUP.
Performance Share Units (“PSUs”)
The following table presents information concerning the outstanding number of PSUs for the period:
Number of PSUs
Beginning balance as at April 1, 20253,072,867 
Granted1,555,823 
Forfeited(761,618)
Ending balance as at December 31, 20253,867,072 
During the nine months ended December 31, 2025, 1,555,823 PSUs, in aggregate, vesting in June 2028, were granted under the SUP at an average grant date fair value of $2.29, per PSU, for an aggregate fair value of $3,563,000.
As at December 31, 2025, included in the 3,867,072 PSUs are 2,415,808 PSUs issued under the LTIP and 1,451,264 PSUs under the SUP.
Share-Based Compensation expense
Total share-based compensation expense for the period is summarized as follows:
For the three months ended December 31,For the nine months ended December 31,
2025202420252024
$$$$
Stock options15 66 65 135 
Share purchase plan – employer contribution338 329 1,008 1,016 
Share-based compensation granted on business acquisitions289 391 1,217 964 
DSUs171 182 562 546 
RSUs418 290 1,400 850 
PSUs424 446 1,079 917 
1,655 1,704 5,331 4,428 
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
| 18
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
10. EARNINGS (LOSS) PER SHARE
For the three months ended December 31,For the nine months ended December 31,
2025202420252024
$$$$
Net earnings (loss)676(3,716)(30,100)(6,748)
Weighted average number of Shares outstanding - basic and diluted (a) (b)
98,249,87796,418,71998,031,46595,900,402
Basic and diluted earnings (loss) per share0.01(0.04)(0.31)(0.07)
(a) "Shares" include the Subordinate Voting Shares and Multiple Voting Shares.
(b) The weighted average number of basic Shares calculation for the three and nine months ended December 31, 2025 excludes the impact of 1,149,702 (2024 - 1,724,553) Subordinate Voting Shares issued as part of the XRM Acquisition as they were subject to forfeitures.
For the nine months ended December 31, 2025 and for the three and nine months ended December 31, 2024, the potentially dilutive outstanding equity instruments, which are the DSUs, PSUs and options mentioned in Note 9 granted under the LTIP, certain shares to be issued as part of anniversary payments related to business acquisition, and the Subordinate Voting Shares issued as part of the XRM acquisition subject to forfeiture, were not included in the calculation of diluted earnings per share since the Company incurred losses and the inclusion of these equity instruments would have an antidilutive effect.
For the three months ended December 31, 2025, the basic and diluted earnings per share are the same as the inclusion of the instruments listed above had no impact on the result.
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
| 19
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
11. ADDITIONAL INFORMATION ON CONSOLIDATED LOSS
The following table provides additional information on the consolidated loss:
For the three months ended December 31,For the nine months ended December 31,
2025202420252024
$$$$
Expenses by Nature
Employee compensation and subcontractor costs98,855 101,093 311,939 305,386 
Tax credits (a)
(1,432)(1,795)(4,492)(5,684)
Licenses and telecommunications3,773 3,215 10,472 9,792 
Professional fees2,287 1,696 7,657 5,433 
Other expenses3,352 2,981 8,968 9,522 
Loss on disposal of property and equipment, intangible and lease modification273 — 310 — 
Depreciation of property and equipment193 515 1,156 1,510 
Depreciation of right-of-use assets475 653 1,555 1,855 
107,776 108,358 337,565 327,814 
Expenses by Function
Cost of revenues78,648 78,376 244,525 238,107 
Selling, general and administrative expenses (b)
28,460 28,814 90,329 86,342 
Depreciation668 1,168 2,711 3,365 
107,776 108,358 337,565 327,814 
(a) Tax credits are included in cost of revenues.
(b) For the nine months ended December 31, 2025, selling, general and administrative expenses include termination and benefit costs for management personnel of nil (2024 - $1,502,000) and nil (2024 - $246,000) of reversal of share-based compensation expense for forfeited equity instruments.
Deferred income tax recovery
During the nine months ended December 31, 2025, the Company recognized a deferred tax asset in the amount of $1,820,000 that was probable of being realized as a result of the deferred tax liability pursuant to the eVerge Acquisition (note 3). The recognized deferred tax asset relates to previous years' net operating losses of the Company in the U.S. available for carryforwards in the amount of approximately $6,838,000 that was previously not recognized.
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
| 20
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
12. BUSINESS ACQUISITION, INTEGRATION AND REORGANIZATION COSTS (RECOVERY)
The following table summarizes business acquisition, integration and reorganization costs (recovery):
For the three months ended December 31,For the nine months ended December 31,
2025202420252024
$$$$
Acquisition costs (a)
95 1,082 1,019 1,082 
Integration costs (b)
447 375 1,397 1,011 
Reorganization costs (c)
— — 423 566 
Employee compensation on business acquisition (d)
—3737167
Contingent consideration adjustment (e)
— (2,738)— (2,738)
Change in fair value of contingent consideration (f)
(914)— (5,086)— 
(372)(1,244)(2,210)88
(a) The acquisition costs consisted mainly of professional fees incurred in relation to business acquisition (note 3).
(b) For the three months ended December 31, 2025, integration costs consisted mainly of common area expenses on vacated premises in relation to business acquisitions and transition costs related to system integrations. For the nine months ended December 31, 2025, integration costs consisted mainly of loss on terminated lease previously acquired as part of business combinations, transition costs related to system integrations and common area expenses on vacated premises in relation to business acquisitions. For the three and nine months ended December 31, 2024 , integration costs consisted mainly of transition costs related to system integrations and common area expenses on vacated premises in relation to business acquisitions.
(c) Reorganization costs consisted of employee termination and benefits costs.
(d) Employee compensation on business acquisition included deferred cash consideration from acquisition.
(e) For the three and nine months ended December 31, 2024, contingent consideration adjustment includes a recovery from changes in the estimated amount payable of $2,096,000 related to the portion payable in cash and $642,000 related to the portion to be settled in shares as per the earn-out consideration of the Datum Acquisition.
(f) Change in fair value of contingent consideration, as a result of changes in estimate of profitability targets and weighting of scenarios, consisted of $914,000 of unrealized gain related to the XRM Acquisition for the three months ended December 31, 2025 and $5,358,000 of unrealized gain related to the XRM Acquisition (note 16) net of $272,000 of unrealized loss related to the eVerge Acquisition (note 3) for the nine months ended December 31, 2025. The contingent consideration is presented within Level 3 of the fair value hierarchy.
13. NET FINANCIAL EXPENSES
The following table summarizes net financial expenses:
For the three months ended December 31,For the nine months ended December 31,
2025202420252024
$$$$
Interest on long-term debt1,912 2,002 5,519 5,454 
Interest on lease liabilities80 118 266 355 
Amortization of finance costs38 55 152 187 
Interest accretion on balances of purchase price payable320 117 908 249 
Financing fees208 155 810 338 
Interest income(219)(75)(350)(337)
2,3392,3727,3056,246
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
| 21
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
14. SUPPLEMENTARY CASH FLOW INFORMATION
Changes in non-cash working capital items are as follows:
For the three months ended December 31,For the nine months ended December 31,
2025202420252024
$$$$
Accounts receivable and other receivables14,686 14,539 21,969 21,026 
Unbilled revenues272 (7,805)(10,210)(7,675)
Tax credits receivable8,453 (1,795)5,653 4,139 
Prepaids1,117 287 1,706 285 
Other assets72 87 213 870 
Accounts payable and accrued liabilities(8,063)(1,412)(21,921)(8,987)
Deferred revenues830 (527)(3,578)(1,909)
17,3673,374(6,168)7,749
During the three and nine months ended December 31, 2025, non-cash investing and financing activities included additions to right-of-use assets and lease liabilities in the amount of $393,000 and $802,000, respectively (2024 - 782,000 and $965,000, respectively).
During the three and nine months ended December 31, 2025, the Company paid an amount of $632,000 in relation to the working capital adjustment for the XRM Acquisition.
15. SEGMENT INFORMATION
The following tables present the Company's operations based on reportable segments:
For the three months ended December 31, 2025
U.S.CanadaInternationalTotal
$$$$
Revenues54,953 54,024 6,185 115,162 
Cost of revenues and operating expenses
Employee compensation and subcontractor costs42,591 44,460 4,951 92,002 
Tax credits— (1,432)— (1,432)
Licenses and telecommunication2,050 1,100 162 3,312 
Other expenses1,817 1,406 244 3,467 
46,458 45,534 5,357 97,349 
Operating income by segment8,495 8,490 828 17,813 
Head office general and administrative expenses9,759 
Business acquisition, integration and reorganization costs recovery (a)
(372)
Foreign exchange loss581 
Operating income before depreciation and amortization7,845 
Depreciation and amortization4,793 
Operating income3,052 
(a) The change in fair value of the contingent consideration, representing a gain of $914,000 included in business acquisition, integration and reorganization costs recovery, relates to the Canada segment (note 12).
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
| 22
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
15. SEGMENT INFORMATION (CONT’D)
For the three months ended December 31, 2024
U.S.CanadaInternationalTotal
$$$$
Revenues48,848 61,695 5,218 115,761 
Cost of revenues and operating expenses
Employee compensation and subcontractor costs36,409 52,576 4,216 93,201 
Tax credits— (1,795)— (1,795)
Licenses and telecommunication1,445 813 110 2,368 
Other expenses1,499 1,272 223 2,994 
39,353 52,866 4,549 96,768 
Operating income by segment9,495 8,829 669 18,993 
Head office general and administrative expenses10,422 
Business acquisition, integration and reorganization costs recovery (a)
(1,244)
Foreign exchange gain(687)
Operating income before depreciation, amortization and impairment10,502 
Depreciation and amortization5,978 
Impairment of goodwill (a)
5,144 
Operating loss(620)
(a) The recovery of $2,738,000 included in business acquisition, integration and reorganization costs recovery and the impairment of goodwill relate to the U.S. segment (note 12).
For the nine months ended December 31, 2025
U.S.CanadaInternationalTotal
$$$$
Revenues177,554 168,873 17,185 363,612 
Cost of revenues and operating expenses
Employee compensation and subcontractor costs130,419 144,383 14,511 289,313 
Tax credits— (4,406)(86)(4,492)
Licenses and telecommunication5,464 3,127 512 9,103 
Other expenses5,133 3,767 699 9,599 
141,016 146,871 15,636 303,523 
Operating income by segment36,538 22,002 1,549 60,089 
Head office general and administrative expenses31,331 
Business acquisition, integration and reorganization costs recovery (a)
(2,210)
Foreign exchange loss1,278 
Operating income before depreciation, amortization and impairment29,690 
Depreciation and amortization17,108 
Impairment of goodwill and intangibles (b)
38,028 
Operating loss(25,446)
(a) The change in fair value of the contingent consideration, representing a net gain of $5,086,000, and the reorganization costs included in business acquisition, integration and reorganization costs recovery, relate mostly to the Canada segment (note 12).
(b) Impairment of goodwill in the amount of $26,500,000 relates to the Canada segment and impairment of goodwill and intangibles in the amount of $9,723,000 and $1,805,000, respectively, relate to the U.S. segment (note 5).
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
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NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
15. SEGMENT INFORMATION (CONT’D)
For the nine months ended December 31, 2024
U.S.CanadaInternationalTotal
$$$$
Revenues146,364 186,472 15,314 348,150 
Cost of revenues and operating expenses
Employee compensation and subcontractor costs111,194 158,682 13,035 282,911 
Tax credits— (5,669)(15)(5,684)
Licenses and telecommunication4,407 2,472 313 7,192 
Other expenses4,893 3,591 676 9,160 
120,494 159,076 14,009 293,579 
Operating income by segment25,870 27,396 1,305 54,571 
Head office general and administrative expenses30,870 
Business acquisition, integration and reorganization costs (a)
88 
Foreign exchange gain(445)
Operating income before depreciation, amortization and impairment24,058 
Depreciation and amortization17,454 
Impairment of goodwill (a)
5,144 
Operating income1,460 
(a) The recovery of $2,738,000 included in business acquisition, integration and reorganization costs (note 12) and the impairment of goodwill relate to the U.S. segment.
Information about revenues
An analysis of the Company’s revenues from customers for each major service category is as follows:
For the three months ended December 31, 2025
U.S.CanadaInternationalTotal
$$$$
Strategic consulting and enterprise transformation services - time and materials arrangements29,402 42,578 5,857 77,837 
Enterprise transformation services - fixed-fee arrangements11,960 8,288 161 20,409 
Business enablement services (a)
13,591 3,158 167 16,916 
54,953 54,024 6,185 115,162 
For the three months ended December 31, 2024
U.S.CanadaInternationalTotal
$$$$
Strategic consulting and enterprise transformation services - time and materials arrangements25,504 52,051 4,687 82,242 
Enterprise transformation services - fixed-fee arrangements8,863 5,510 363 14,736 
Business enablement services (a)
14,481 4,134 168 18,783 
48,848 61,695 5,218 115,761 
(a) Including support revenues of $9,319,000 (2024 - $8,458,000) for U.S., $2,273,000 (2024 - $3,293,000) for Canada and $104,000 (2024 - $127,000) for the International operating segment for a total of $11,696,000 (2024 - $11,878,000) for the three months ended December 31, 2025.
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
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NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
15. SEGMENT INFORMATION (CONT’D)
For the nine months ended December 31, 2025
U.S.CanadaInternationalTotal
$$$$
Strategic consulting and enterprise transformation services - time and materials arrangements
95,560 138,319 15,811 249,690 
Enterprise transformation services - fixed-fee arrangements37,434 20,408 888 58,730 
Business enablement services (a)
44,560 10,146 486 55,192 
177,554 168,873 17,185 363,612 
For the nine months ended December 31, 2024
U.S.CanadaInternationalTotal
$$$$
Strategic consulting and enterprise transformation services - time and materials arrangements
78,394 157,688 13,864 249,946 
Enterprise transformation services - fixed-fee arrangements25,054 17,718 1,223 43,995 
Business enablement services (a)
42,916 11,066 227 54,209 
146,364 186,472 15,314 348,150 
(a) Including support revenues of $29,866,000 (2024 - $24,202,000) for U.S., $7,180,000 (2024 - $8,497,000) for Canada and $322,000 (2024 - $127,000) for the International operating segment for a total of $37,368,000 (2024 - $32,826,000) for the nine months ended December 31, 2025.
Major customer
During the three months ended December 31, 2025, no customer generated more than 10% of total revenues (December 31, 2024 - One Canadian customer generated more than 10% of total revenues for $13,164,000 ).
During the nine months ended December 31, 2025, no customer generated more than 10% of total revenues (December 31, 2024 - One Canadian customer generated more than 10% of total revenues for $41,785,000).
As at December 31, 2025, accounts receivable and other receivables and unbilled revenues from one Canadian customer amounted to $11,587,000 or 11% (March 31, 2025 - One Canadian customer represented more than 10% of total accounts receivable and other receivables and unbilled revenues for $11,171,000 or 10%).
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
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NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024
(Tabular amounts are in thousands of Canadian dollars, except share and per share data in tables) (unaudited)
16. FINANCIAL INSTRUMENTS
Fair Value of Financial Instruments
The carrying amount of cash, accounts receivable and other receivables, other assets, accounts payable and accrued liabilities and long-term debt bearing interest at variable rates is a reasonable approximation of fair value.
The fair value of the long-term debt bearing interest at fixed rates is estimated by discounting expected cash flows at rates that would be currently offered to the Company for debts of the same remaining maturities and conditions (Level 2). For both December 31, 2025 and March 31, 2025, the Company has determined that the fair value of the Credit Facility and the balances of purchase price payable are not significantly different than their carrying amount.
The contingent consideration related to the XRM Acquisition is payable based on the achievement of growth in excess of the trailing twelve months gross margin over a consecutive 12 months period within the 18 months following the acquisition date and is included in Level 3 of the fair value hierarchy. The fair value was determined using a scenario-based method, under which the Company identifies multiple outcomes, probability-weights the contingent consideration payoff under each outcome, and discounts the result to arrive at the expected present value of the contingent consideration. The actual earn-out payout can range from nil to $10,500,000. The maximum potential impact on the results can be an increase of nil or a decrease of $10,500,000 in earnings.
Alithya Group inc. – Interim Condensed Consolidated Financial Statements for the three and nine months ended December 31, 2025 and 2024
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