SNC-Lavalin (TSX:SNC) operates a resources service business and is actively working with clients to design clean energy solutions and meet carbon-reduction targets. SNC-Lavalin is the engineer and integrator for HyNet, the world’s first low carbon hydrogen project located in the northern United Kingdom, and this year, the company delivered designs for three offshore wind projects in northern Europe.
Broad, end-to-end capabilities and integrated approach to sustainability
The project, however, that perhaps best showcases SNC-Lavalin’s broad, end-to-end capabilities and integrated approach to sustainability is Montreal’s Réseau express métropolitain, or REM. The latest in a long track record of signature light-rail transit projects that SNC-Lavalin has helped to design, build, operate and maintain, the 67-km REM is the largest public transit project of the past 50 years in Quebec. An electric and fully automated network that will connect the Montreal region, it is being designed and built using advanced digital solutions and offsite modular manufacturing of the line’s 26 stations.
Complex and leading-edge projects
SNC-Lavalin’s work on complex, leading edge projects like REM continues to garner the company a number of awards, including the prestigious Schreyer Award and Award of Excellence for the highest degree of technical merit at the 2020 Canadian Consulting Engineering Awards for the company’s work on the Samuel De Champlain Bridge. Atkins, an SNC-Lavalin Group company, was also recognized with a 2020 Hong Kong Institution of Engineers Innovation Award for the company’s cofferdam design work on the world’s longest and largest subsea road link between Hong Kong and Macau.
Refocus the business on engineering services
In short, SNC-Lavalin has much to look forward to. The company’s decision in 2019 to refocus the business on engineering services and exit lump-sum turnkey construction contracting (LSTK) was clearly the right one, as engineering services have proven resilient through the pandemic with a robust pipeline of new business as the company heads into 2022.
Leveraging digital capabilities as part of a more integrated focus on sustainable infrastructure development
Further, SNC-Lavalin continued to reduce the LSTK backlog by $800 million as of the end of the second quarter of fiscal 2021. SNC-Lavalin is working with the company’s partners to develop new, more collaborative contracting models, which will allow the industry to more fully leverage digital capabilities as part of a more integrated focus on sustainable infrastructure development.
Providing solutions to the world’s most pressing challenges
That foundation positions SNC-Lavalin well, as the company looks to provide solutions to the world’s most pressing challenges. It also allows SNC-Lavalin to contribute and give back to the company’s communities in other ways. Earlier this month, SNC-Lavalin announced a donation to two leading hospital foundations: the McGill University Health Centre (MUHC) and the Montreal Children’s Hospital Foundations.
Strong tailwinds and bright future outlook
That is in addition to other contributions, including donating to Feeding America, the largest hunger-relief network in the United States, and supporting St. Mary’s Hospital in London in the United Kingdom. SNC-Lavalin is also supporting oil and gas multinational BP in ambitious carbon-reduction efforts. Overall, SNC-Lavalin’s has some pretty strong tailwinds and could outperform the general market over the next decade.
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The Motley Fool has no position in any of the stocks mentioned. Fool contributor Nikhil Kumar has no position in any of the stocks mentioned.