Defsec expects gov't services run rate to rise to $8.3M

Executive Summary

• Defsec Technologies Inc. announces a significant expansion in its government services business, adding 15 new roles to its existing 24, bringing the total headcount to 39 effective February 2026.
• The company expects its go-forward annualized program billings to increase to approximately CAD$8.3 million, representing a 704% increase over fiscal 2024 billings of $1 million.
• Annualized gross margin contribution from government services is projected to rise to approximately $2.3 million, a 845% increase over fiscal 2024 gross margins of $200,000.

Key Details

• Headcount Expansion: Addition of 15 roles to the previously disclosed 24 roles (announced Oct. 29, 2025), totaling 39 staffed roles commencing in February 2026.
• Revenue Growth: Go-forward annualized program billings expected to reach ~CAD$8.3 million, up from the previously reported $5.1 million (Oct. 29, 2025) and $1.0 million in fiscal 2024.
• Margin Growth: Annualized gross margin contribution expected to increase to ~$2.3 million (up from $200,000 in fiscal 2024); approximately $500,000 of this increase is attributed to the new roles added since Oct. 29, 2025.
• Contract Specifics: Expansion driven by increased work scope under the Directorate Land Command Systems Program Management Software Engineering Facility (DSEF) contract for digital modernization of the Canadian Armed Forces.
• Subcontracting Arrangement: Defsec has subcontracted 13 of the 15 additional roles to ADGA Group Consultants Inc. to fast-track fulfillment.
• Timeline: Commencement of work is scheduled for February 2026, subject to customary administrative onboarding procedures. The company has received the DSEF statement of work and expects to complete onboarding in the coming weeks.
• Product Business: The updated revenue and margin figures exclude the product business (principally ARWEN sales), which is projected to see significant growth in fiscal 2025 compared to fiscal 2024.
• Financial Position: The company expects its year-end filings to align with Q3 growth trajectories, supported by financing completed in Q4.

Notable Quotes

• Sean Homuth, President and CEO: "It's very gratifying to see the continued momentum in our programmatic work on digital modernization of the Canadian Armed Forces with our industry partners."
• Sean Homuth, President and CEO: "The announcement today means that Defsec's annualized go-forward revenue run rate of approximately $8.3-million at the beginning in February, 2026, are expected to be approximately 704-per-cent higher than our actual fiscal 2024 programmatic revenue of $1.0-million."
• Lieutenant General Jean-Marc Lanthier (ret.), CEO of ADGA: "ADGA brings experienced software development experts who have supported DND for many years. We look forward to continuing to deploy this operationally critical talent in collaboration with Defsec so the customer benefits from teams ready to deliver without delay."