Enerflex Ltd. has announced its fourth-quarter and full-year financial results for 2025, revealing a significant increase in revenue and record free cash flow. The company also confirmed an agreement to divest the majority of its operations in the Asia Pacific region, a strategic move aimed at optimizing and simplifying its business.
For the fourth quarter of 2025, Enerflex generated revenue of $627 million, an increase from $561 million in the prior year, primarily driven by strong execution in the Engineered Systems (ES) product line. Gross margin before depreciation and amortization was $177 million, or 28% of revenue. The Energy Infrastructure (EI) and After-Market Services (AMS) product lines contributed significantly to this margin. Adjusted EBITDA was $123 million, a slight increase from the previous year. Notably, the company achieved a record free cash flow of $141 million in Q4 2025, bolstered by working capital recovery and project execution.
Enerflex has entered into a definitive agreement to sell the majority of its operations in the Asia Pacific region, which primarily focus on the AMS product line, to INNIO Group. This divestiture is part of Enerflex’s ongoing efforts to streamline its business and sharpen its focus on core regions including North America, Latin America, and the Middle East. Following the transaction, Enerflex will continue to provide ES solutions in APAC through local sales teams, with equipment manufactured in North America.
The company’s ES backlog stood at $1.1 billion as of December 31, 2025, providing strong visibility for future revenue. Bookings in Q4 2025 were $377 million, indicating a healthy book-to-bill ratio. Enerflex’s U.S. contract compression business continues to perform well, driven by increasing natural gas production, particularly in the Permian basin. The company anticipates steady demand across its business lines in 2026, with the EI product line supported by approximately $1.3 billion in revenue from existing customer contracts. Capital expenditures for 2026 are targeted between $175 million and $195 million, with a significant portion allocated to growth opportunities.
Enerflex’s Board of Directors increased the quarterly dividend by 13% to CAD$0.0425 per common share. The company also continued its share repurchase program under its normal course issuer bid. Enerflex successfully refinanced its 2027 senior secured notes, reducing annual interest costs and enhancing tax efficiency. Net debt was reduced to $501 million, resulting in a bank-adjusted net debt-to-EBITDA ratio of approximately 1.0x at the end of Q4 2025.
Paul Mahoney, President and CEO of Enerflex, highlighted the strong operational and financial results capping an excellent year, emphasizing the resilience of the EI and AMS business lines. He noted that the APAC divestiture underscores the company’s commitment to simplification and focus on core regions. CFO Preet Dhindsa added that the record free cash flow and successful debt refinancing solidify the company’s financial position, with a continued focus on enhancing profitability and disciplined growth.