Answer the following questions after reviewing the annual report

From the Management Report and Audit Report:

a) What information does the Management Report (Not MD&A) convey?

b) Which audit company audited the Annual Report? Is the MD&A audited?

c) Which type of Audit opinion is provided in the Annual Report? (Be Specific)

d) Which Standard (or principle-if any) does the Annual Report Conform with?

AECON GROUP INC. | 2014 ANNUAL REPORT BUILT + FOR SUCCESS AECON HAS TRANSFORMED INTO A VERTICALLY INTEGRATED BUSINESS + with unrivalled capabilities - building a foundation to support growth as Canada's premier construction and infrastructure development company. aecon.com/2014annualreport PARTNERSHIPS TURNKEY CAPABILITIES Forming strategic partnerships is a key component of Aecon's competitive strategy and a major differentiator when bidding on large projects. The number of large-scale projects Aecon participates in has grown significantly, as has our share in these projects. As one of the most verticallyintegrated Canadian contractors, Aecon offers clients on-demand turnkey capabilities through a diversified portfolio of services with the ability to self-perform the majority of scope. Driven by the 'One Aecon' approach, we have created synergies and cost savings for both Aecon and our clients through economies of scale and resource sharing. REPUTATION EXECUTION Aecon's reputation as a safety leader, and Employer of Choice, coupled with our value as a preferred contractor with a stringent code of ethics, has led to repeat work with top tier clients across our core segments. Recurring revenue through Master Service Agreements and supplier-of-choice arrangements are a growing part of Aecon's business. Aecon has a proven track record of successfully executing large and complex projects on-time and on-budget. Underpinning Aecon's project delivery is a rigorous commitment to project controls and risk management, with a focus on world-class systems and tools. AECON GROUP INC. + ANNUAL REPORT 2014 1 DEAR FELLOW SHAREHOLDERS + Over the course of the last few years, Aecon has transformed itself into a national company, growing in the targeted sectors of Infrastructure, Energy, Mining and Concessions, with unparalleled turnkey capabilities, while becoming a reputable partner-of-choice - truly, a company built for success. Along the way, there have been challenges, and in this regard 2014 was in some aspects a year of transition, with lower revenue of $2.6 billion, due to longer than expected delays in the ramp-up of new projects. However, 2014 also marked continued margin improvement with Adjusted EBITDA margin of 6.5 per cent for the year - the highest in Aecon's history. We also reported unprecedented annual new contract awards of $3.5 billion, and record year-end backlog of $2.7 billion (a 50 per cent increase over 2013). In addition, for the fourth consecutive year, Aecon's Board of Directors approved an increase in the annual dividend to $0.40 per share from $0.36 per share. A number of objectives were realized in 2014, most noteworthy of which was a record year on the safety front, with just one Lost Time Injury while performing 19.2 million man-hours of work - a direct result of an unwavering commitment to safety by all Aecon employees. Also, for the eighth straight year, Aecon was recognized as one of the \"Best Employers in Canada. \" AECON GROUP INC. + ANNUAL REPORT 2014 2 YEAR-END BACKLOG $2.7 Billion ANNUAL NEW CONTRACTS AWARDED $3.5 Billion Evident as well are the benefits of the 'One Aecon' approach. Leveraging Aecon's vertically and horizontally aligned capabilities with collaboration across diverse businesses creates synergies and cost savings for both Aecon and our clients through economies of scale and resource sharing - a winning proposition for our clients, and what we call the Aecon Advantage. The benefits have also been seen from the significant volume of recurring revenue from Aecon's growing alliances and supplier-ofchoice arrangements, as Aecon is increasingly seen as a long-term partner to our clients. This strategic direction, which has driven Aecon's evolution to becoming a Canadian leader in large-scale, turnkey project delivery, continues, as we remain focused on operational execution, project controls, and risk management - all within a disciplined framework towards bottom-line growth. Aecon's exemplary pre-qualification record on major projects demonstrates Aecon's expertise and capability to deliver large, complex, multi-disciplinary projects. The number of such large-scale projects in which Aecon participates has grown significantly, as has our share of these projects. Increasingly, Aecon is leading major consortia, as the sought-after Canadian partner-of-choice, including both the John Hart Generating Station and the Waneta Dam in British Columbia, and the Waterloo Region LRT in Ontario. Additionally, there are a few particular standout initiatives we will strategically focus on in 2015, including: + + \u0007 everaging Aecon's Public-Private Partnership L (P3) expertise by successfully participating in targeted concession opportunities in Canada. + + \u0007 trategically driving future participation in the S rapidly developing P3 market in the U.S. ++ \u0007 oncluding the strategic initiative with respect C to Aecon's interest in the Quito Airport concession. As we move forward in 2015, Aecon's exposure to volatility in resource and commodity prices is mitigated through the significant backlog in each of our segments, including oil sands work, as well as the very strong pipeline of opportunities in the approximately 80 per cent of revenue not linked to oil spending. Together, these factors capture our strategy of serving diverse sectors, for which Aecon has been purpose-built. We expect the strong pipeline of infrastructure projects being pursued and the demand for Aecon's broad spectrum of services in the Energy and Mining segments will continue to contribute to margin growth. Overall, Aecon's diversified portfolio of work, with record year-end backlog, focus on execution, reputation as a partner-of-choice, and strong financial resources, continue to be key strengths in capitalizing on the opportunities ahead. On behalf of the Board of Directors, we thank you for your continued support as Aecon becomes Canada's premier construction and infrastructure development company. John M. Beck Executive Chairman Aecon Group Inc. Terrance L. McKibbon President and Chief Executive Officer Aecon Group Inc. AECON GROUP INC. + ANNUAL REPORT 2014 3 STABLE FOUNDATION + With the foundation of an unmatched national presence, Aecon has been purpose-built to serve diverse sectors. The ability to self-perform services at virtually every stage of a project is a growing competitive advantage. The Aecon Advantage. AECON GROUP INC. + ANNUAL REPORT 2014 4 INFRASTRUCTURE Aecon Infrastructure brings a unique blend of expertise to Canada's vast infrastructure network, including transportation and heavy civil projects. Our proven track record and capabilities, and long list of pre-qualifications position Aecon to capitalize on the robust pipeline of opportunities ahead. MINING Aecon Mining offers turnkey services for both mine installations and contract mining with a reputation for safety, reliability and performance. Aecon Mining has emerged as a site installation leader in the potash sector, while further solidifying its position as one of the largest mining and land reclamation contractors in the oil sands. ENERGY Aecon Energy is focused on a variety of sub-sectors, including nuclear services, power generation, oil and gas facilities, pipelines, power transmission projects and renewable energy. Aecon Energy is strategically positioned to participate in Canada's diverse energy sector. CONCESSIONS Aecon Concessions is primed to respond to the strong pipeline of Public-Private Partnership opportunities by bringing a specialized, fine-tuned approach to project management, financing and development, both in Canada and internationally. AECON GROUP INC. + ANNUAL REPORT 2014 5 PARTNER OF CHOICE + Forming strategic partnerships is a key component of our competitive strategy and a major differentiator when bidding on large projects, offering access to major projects no single contractor can perform alone. Our partnerships include not only construction, engineering and development firms, but also Aboriginal groups, unions, local communities, and our clients. AECON GROUP INC. + ANNUAL REPORT 2014 6 AECON'S SHARE IN JOINT VENTURE PROJECTS John Hart Generating Station BC 60% Regina Wastewater Treatment Plant SK 50% Waneta Dam BC 60% Waterloo Region LRT ON 51% Port Mann Tunnel BC 40% Eglinton Crosstown LRT Tunnel ON 50% Capilano Tunnels BC 30% Darlington Nuclear Refurbishment ON 50% Syncrude Cogen Plant AB 50% York Viva Rapid Transit ON 50% IPL Pipeline and Stations AB 50% TTC Sheppard South ON 30% Northeast Anthony Henday Ring Road AB 22% AECON GROUP INC. + ANNUAL REPORT 2014 7 ON SOLID GROUND + At Aecon, safety is our first priority and number one core value. Operating safely is the most important responsibility we have and we are committed to providing industry-leading working conditions on each and every job site. Each year we celebrate Safety Week with over 14,000 employees, partners and clients attending over 130 events at project sites and office locations across Canada. Learn more about Aecon's commitment to our \"Safety First\" core value by visiting aecon.com/safetyfirst. AECON GROUP INC. + ANNUAL REPORT 2014 8 ONE OF CANADA'S BEST EMPLOYERS FOR EIGHT YEARS RUNNING RESPECTING THE ENVIRONMENT IS OUR COLLECTIVE RESPONSIBILITY As voted by our employees, Aecon is proud to have been recognized as one of the Best Employers in Canada for the past eight years. Being recognized as a Best Employer highlights our ongoing commitment to being a preferred employer that attracts and retains the best and brightest employees. Aecon takes a holistic approach to corporate social responsibility, infusing environmental safety and protection with rigid training, compliance and enforcement. Our commitment to the environment is reflected in our pursuit of the latest innovative technologies designed to safely minimize our impact while providing operational efficiencies. Aecon employs a diverse array of skilled trades and technical staff, including health and safety officers, nuclear technicians, tunnel boring foremen, quality control technicians, and project engineers. Learn more about the many exciting careers available at Aecon by visiting aecon.com/careers. To us, this means striving to deliver infrastructure that supports our economy and society in ways that are sensitive to the needs of the communities in which we work, and to the environment that will be passed on to future generations. In this way, we aspire to have a positive impact in the communities where our business is conducted. AECON GROUP INC. + ANNUAL REPORT 2014 9 FINANCIAL HIGHLIGHTS + FIVE-YEAR FINANCIAL PERFORMANCE (1) REVENUE ADJUSTED EBITDA(2) ADJUSTED EBITDA MARGIN ($ millions) ($ millions) (per cent) 2,750 2,896 2,887 3,069 172 2,614 184 170 6.0 148 6.0 2012 2013 6.5 5.1 60 2010 2011 2012 2013 2014 YEAR-END BACKLOG ($ millions) 2.2 2010 2011 2012 2013 2014 2010 2011 NEW CONTRACT AWARDS BOOK VALUE PER SHARE(3) ($ millions) (diluted) ($ per share) 3,495 2,654 2,447 2,390 2,428 2014 3,011 2,839 2,985 8.41 2,413 9.26 10.27 11.10 11.67 1,773 2010 2011 2012 2013 2014 2010 2011 2012 2013 2014 2010 2011 2012 2013 2014 2014 REVENUE BY SEGMENT ANNUAL DIVIDENDS PER SHARE (per cent) ( per share) 0.40 (4) 0.36 0.32 0.28 ENERGY 48% 0.20 INFRASTRUCTURE 33% MINING 19% 2011 AECON GROUP INC. + ANNUAL REPORT 2014 10 2012 2013 2014 2015 FINANCIAL HIGHLIGHTS (in millions of Canadian dollars, except per share amounts) For the year ended December 31 2014 2013 $ $ 2,614.1 3,068.6 170.2 184.0 Operating profit* 63.7 97.3 Profit 30.0 40.6 Revenue Adjusted EBITDA* Adjusted profit* 21.8 47.8 Backlog revenue 2,654 1,773 Basic 0.55 0.77 Diluted 0.51 0.72 Earnings per share Adjusted earnings per share* Basic 0.40 0.91 Diluted 0.40 0.84 Dividends per share 0.36 0.32 Book value per share* Basic 11.69 11.10 Diluted 11.67 11.10 Weighted average number of shares outstanding (in millions) Basic 54.1 52.7 Diluted 84.3 78.9 1. The Company prepares its consolidated financial statements in accordance with Canadian generally accepted accounting principles (\"GAAP\") as set out in the Handbook of the Canadian Institute of Chartered Accountants (\"CICA Handbook\"). In 2010, the CICA Handbook was revised to incorporate International Financial Reporting Standards (\"IFRS\") and to require publicly accountable enterprises to apply such standards effective for years beginning on or after January 1, 2011. Accordingly, the Company commenced reporting on this basis in its consolidated financial statements at December 31, 2011. The term \"Canadian GAAP\" refers to Canadian GAAP before the adoption of IFRS. Amounts previously reported for 2010 have been restated to give effect to these changes in accordance with IFRS. On January 1, 2013, the Company also adopted various new accounting standards including IFRS 11 \"Joint Arrangements\" Amounts previously reported for 2012 have been restated to give effect to . these changes, while amounts for 2011 and prior years are prepared in accordance with IFRS or Canadian GAAP before the adoption of new accounting standards in 2013. 2. Adjusted EBITDA represents operating profit (loss) adjusted to exclude depreciation and amortization, the gain (loss) on sales of assets and investments, restructuring costs, gain (loss) on mark-to-market adjustments related to the Company's long-term incentive plan (\"LTIP\") program, and net income (loss) from projects accounted for using the equity method, but including \"JV EBITDA\" from projects accounted for using the equity method. 3. Book Value Per Share (diluted) is calculated as shareholders' equity plus the increase in shareholders' equity if options and convertible debentures in the money are exercised and/or converted plus officer share purchase loans plus the book value of LTIP shares, all divided by shares outstanding at year end (diluted). Shares outstanding at year end (diluted) represent the number of shares issued at the end of the year plus the number of shares issuable if options and convertible debentures in the money were exercised and/or converted plus the number of LTIP shares. 4. As approved by Aecon's Board of Directors on March 4, 2015. * The financial highlights and five-year financial performance section of the annual report present certain non-GAAP and additional GAAP financial measures to assist readers in understanding the Company's performance. Non-GAAP financial measures are measures that either exclude or include amounts that are not excluded or included in the most directly comparable measures calculated and presented in accordance with GAAP Additional GAAP . financial measures are presented on the face of the Company's consolidated statements of income and are not meant to be a substitute for other subtotals or totals presented in accordance with IFRS, but rather should be evaluated in conjunction with such IFRS measures. These measures are defined in the notes to the five-year performance section. AECON GROUP INC. + ANNUAL REPORT 2014 11 MANAGEMENT'S DISCUSSION AND ANALYSIS OF OPERATING RESULTS AND FINANCIAL CONDITION (\"MD&A\") December 31, 2014 Table of Contents Introduction................................................................................................14 Forward-Looking Information..................................................................15 Financial Reporting Standards................................................................15 Non-GAAP and Additional GAAP Financial Measures.......................15 Business Strategy......................................................................................16 Consolidated Financial Highlights...........................................................19 Reporting Segments..................................................................................22 Quarterly Financial Data...........................................................................26 Quarterly Financial Highlights.................................................................27 Selected Annual Information...................................................................28 Financial Condition, Liquidity and Capital Resources..........................28 Summary of Cash Flows...........................................................................29 New Accounting Standards.....................................................................30 Supplemental Disclosures.......................................................................30 Risk Factors................................................................................................31 Outlook.........................................................................................................39 AECON GROUP INC. + ANNUAL REPORT 2014 13 The following discussion and analysis of the consolidated results of operations and financial condition of Aecon Group Inc. (\"Aecon\" or the \"Company\") should be read in conjunction with the Company's December 31, 2014 consolidated financial statements and notes. This MD&A has been prepared as of March 4, 2015. Additional information on Aecon is available through the System for Electronic Document Analysis and Retrieval (\"SEDAR\") at www.sedar.com and includes the Company's Annual Information Form and other securities and continuous disclosure filings. INTRODUCTION The Infrastructure segment includes all aspects of the construction of both public and private infrastructure, primarily in Canada, and on a selected basis, internationally. The Infrastructure segment focuses primarily on the following sectors: The Energy segment encompasses a full suite of service offerings to the energy sector including industrial construction and manufacturing activities such as in-plant construction, site construction and module assembly. The activities of the Energy segment are concentrated predominately in Canada. However, Aecon's subsidiary, Innovative Steam Technologies Inc. (\"IST\"), markets and sells \"once-through\" heat recovery steam generators and enhanced oil recovery boilers throughout the world. The Energy segment focuses primarily on the following sectors: INFRASTRUCTURE ENERGY Aecon operates in four principal segments within the construction and infrastructure development industry: Infrastructure, Energy, Mining and Concessions. Sector Transportation Service Focus Roads and bridges Sector Oil and Gas Rail and transit Municipal construction Material engineering and design Heavy Civil Liquefied natural gas (LNG) plants Power Generation Hydroelectric Nuclear Thermal and hydro Natural gas Tunnels Foundations Steam Assisted Gravity Drainage (SAGD) operations in the oil sands Turn-key well pad construction and field facilities Asphalt production and aggregates Commercial site design Service Focus Renewables Airports Oil and gas pipeline construction and integrity programs Marine Telecom infrastructure Major civil transportation infrastructure Power distribution networks Transit stations Water and sewer construction Industrial site buildings District energy Tenant improvements Locate services Interior fit-up programs Utility design Mechanical systems Social Infrastructure High voltage transmission Rooftop energy systems Water treatment facilities Utilities Energy Support Fabrication (pipe fabrication, custom Services steel) Modularization Heat recovery steam generators and enhanced oil recovery boilers AECON GROUP INC. + ANNUAL REPORT 2014 14 The Mining segment offers turn-key services consolidating Aecon's mining capabilities and services across Canada, including both mine site installations and contract mining. This segment focuses on delivering construction services that span the scope of a project's life cycle from overburden removal and resource extraction to processing and environmental reclamation. The Mining segment focuses primarily on the following sectors: MINING Activities Mine Site Installations and Contract Mining Service Focus Mine site development including overburden removal and piling services Environmental reclamation services Ore storage and management Heavy mechanical works Complete process installations Full fabrication for mine site installations Activities within the Concessions segment include the development, financing, construction and operation of infrastructure projects by way of build-operate-transfer, build-own-operate-transfer and other public-private partnership contract structures. The Concessions segment focuses primarily on the following activities: Project Financing Service Focus Development of domestic and international Public-Private Partnership (P3) projects Private finance solutions Development Developing effective strategic partners Leading and/or actively participating in development teams Construction and Operation The information in this Management's Discussion and Analysis includes certain forward-looking statements. Although these forward-looking statements are based on currently available competitive, financial and economic data and operating plans, they are subject to risks and uncertainties. In addition to general global events outside Aecon's control, there are factors which could cause actual results, performance or achievements to vary from those expressed or inferred herein including risks associated with an investment in the common shares of Aecon and the risks related to Aecon's business, including Large Project Risk and Contractual Factors. Risk factors are discussed in greater detail in the section on \"Risk Factors\" later in this MD&A. Forward-looking statements include information concerning possible or assumed future results of Aecon's operations and financial position, as well as statements preceded by, followed by, or that include the words \"believes\" \"expects\" , , \"anticipates\" \"estimates\" \"projects\" \"intends\" \"should\" or , , , , similar expressions. Other important factors, in addition to those discussed in this document, could affect the future results of Aecon and could cause its results to differ materially from those expressed in any forward-looking statements. Aecon assumes no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise. FINANCIAL REPORTING STANDARDS CONCESSIONS Activities FORWARD-LOOKING INFORMATION Seamlessly integrating the services of all project participants Harnessing strengths and capabilities of the Aecon group The construction industry in Canada is seasonal in nature for companies like Aecon who perform a significant portion of their work outdoors, particularly road construction and utilities work. As a result, less work is performed in the winter and early spring months than in the summer and fall months. Accordingly, Aecon has historically experienced a seasonal pattern in its operating results, with the first half of the year, and particularly the first quarter, typically generating lower revenue and profit than the second half of the year. Therefore, results in any one quarter are not necessarily indicative of results in any other quarter, or for the year as a whole. The Company prepares its consolidated financial statements in accordance with International Financial Reporting Standards (\"IFRS\"). NON-GAAP AND ADDITIONAL GAAP FINANCIAL MEASURES The MD&A presents certain non-GAAP and additional GAAP (GAAP refers to Canadian Generally Accepted Accounting Principles) financial measures to assist readers in understanding the Company's performance. These nonGAAP measures do not have any standardized meaning and therefore are unlikely to be comparable to similar measures presented by other issuers and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP . Management uses these non-GAAP and additional GAAP measures to analyze and evaluate operating performance. Aecon also believes the non-GAAP and additional GAAP financial measures below are commonly used by the investment community for valuation purposes, and are useful complementary measures of profitability, and provide metrics useful in the construction industry. The most directly comparable measures calculated in accordance with GAAP are profit (loss) attributable to shareholders or earnings (loss) per share. AECON GROUP INC. + ANNUAL REPORT 2014 15 Throughout this MD&A, the following terms are used, which are not found in the Canadian Institute of Chartered Accountants Handbook and do not have a standardized meaning under GAAP . Non-GAAP Financial Measures Non-GAAP financial measures are measures that either exclude or include amounts that are not excluded or included in the most directly comparable measures calculated and presented in accordance with GAAP in the consolidated financial statements. \"Adjusted EBITDA\" represents operating profit (loss) adjusted to exclude depreciation and amortization, the gain (loss) on sales of assets and investments, restructuring costs, gain (loss) on mark-to-market adjustments related to the Company's long-term incentive plan (\"LTIP\") program, and net income (loss) from projects accounted for using the equity method, but including \"JV EBITDA\" from projects accounted for using the equity method. \"JV EBITDA\" represents Aecon's proportionate share of the earnings or losses from projects accounted for using the equity method before depreciation and amortization, net financing expense and income taxes. \"Adjusted EBITDA margin\" represents Adjusted EBITDA as a percentage of revenue. \"Adjusted profit (loss)\" represents the profit (loss) adjusted to exclude the after-tax fair value gain (loss) on the embedded derivative portion of convertible debentures. \"Adjusted earnings (loss) per share\" represents earnings (loss) per share calculated using Adjusted profit (loss). \"Backlog\" means the total value of work that has not yet been completed that: (a) has a high certainty of being performed as a result of the existence of an executed contract or work order specifying job scope, value and timing; or (b) has been awarded to Aecon, as evidenced by an executed binding letter of intent or agreement, describing the general job scope, value and timing of such work, and where the finalization of a formal contract respecting such work is reasonably assured. Additional GAAP Financial Measures Additional GAAP financial measures are presented on the face of the Company's consolidated statements of income and are not meant to be a substitute for other subtotals or totals presented in accordance with International Financial Reporting Standards (\"IFRS\"), but rather should be evaluated in conjunction with such IFRS measures. \"Gross profit\" represents revenue less direct costs and expenses. Not included in the calculation of gross profit are marketing, general and administrative expenses (\"MG&A\"), depreciation and amortization, income or AECON GROUP INC. + ANNUAL REPORT 2014 16 losses from construction projects accounted for using the equity method, foreign exchange, interest, gains or losses on the sale of assets, income taxes, and noncontrolling interests. \"Gross profit margin\" represents Gross profit as a percentage of revenue. \"Operating profit (loss)\" represents the profit (loss) from operations, before net financing expense, income taxes and noncontrolling interests. \"Operating margin\" represents Operating profit (loss) as a percentage of revenue. BUSINESS STRATEGY Aecon's overall strategic goal is to be the premier construction and infrastructure development company in Canada. Over the course of the last few years, the Company has deliberately positioned itself in three key end markets: Infrastructure, Energy and Mining. Today, Aecon has an unrivalled ability to provide a comprehensive suite of construction, contracting and infrastructure development services across Canada. Having built this foundation and national footprint, the Company has been, and will continue to be, focused on operational execution, project controls, risk management and organic growth - all within a disciplined framework towards Aecon's goal of ongoing improvement in Adjusted EBITDA margin. Aecon's organizational structure is now designed to ensure that a 'One Aecon' approach is reflected in how the Company's capabilities in its targeted end markets are most effectively harnessed to provide a superior proposition to its clients. Partnerships are an important dimension of the Company's plan to successfully position itself in this regard. Organic growth has been achieved through a number of Joint Venture partnerships, most notably in the large diameter pipeline sector in 2013 and 2014. Increasingly, Aecon-led partnerships with some of the world's leading contractors demonstrate the reputation and credibility Aecon has established with respect to large, complex, multidisciplinary construction and infrastructure development projects. We are currently leading three significant projects that were awarded in 2014 alongside large, global partners: a section of the Eglinton-Crosstown tunnel project in Ontario, the John Hart Generating Station project in British Columbia, and the Waterloo Region Light Rapid Transit project in Ontario. There are four core elements that comprise the 'Aecon Advantage', its strategic path and focus on performance and health. 1. Invest in Aecon's People and Their Safety The Company is committed to the development of its 10,000-strong employees in order to build upon its leadership position in the sector and drive to be Canada's premier construction and infrastructure development company. This cornerstone is especially important as competition in Canada for skilled workers, engineers and project managers can be intense. Initiatives are being undertaken to strengthen practices at both the corporate and business segmentsrelated to recruitment, training, leadership development, and building a 'performance and learning culture'. Aecon University continues to be an innovative vehicle for employees to access the full range of learning, technical and development opportunities across the Company. Aecon's investment in its employees was recognized again in 2014 by Aon Hewitt as one of the Best Employers in Canada for the eighth straight year. A company's ability to demonstrate that it has industryleading safety programs and a culture that puts safety first is an important competitive differentiator in the construction industry. For many clients, most notably in the industrial sector, particularly resources and commodityrelated projects, a contractor's demonstrated commitment to safety throughout the organization is as important to selecting a contractor as their commitment to schedule, quality and price. This focus on safety is one of the reasons that maintaining and strengthening our industry leading safety program and culture is a key element of Aecon's business strategy. 2014 was another record year in safety performance for Aecon. In 2014 we incurred just one Lost Time Injury while performing 19.2 million man-hours of work and we reduced our Non-Lost Time Injury Frequency by 27% from 6.28 per 200,000 person hours in 2013 to 4.59 per 200,000 person hours in 2014. This performance is the result of an ongoing emphasis on safety as the Company's pre-eminent core value. 2.Profitability Aecon is one of the most diverse companies in its industry, able to self-perform a wide variety of construction, contracting and infrastructure development services, and to offer clients a single solution to their needs - with turnkey capabilities embodied in the 'One Aecon' strategy. This approach allows Aecon to focus on enhancing client value and competing for business on the basis of more than just price. A key component of Aecon's operational diversity strategy is the development of its vertical and horizontal integration capabilities. The ability to self-perform services required at virtually every stage of a project, from site clearing to final construction, often including complete procurement services, is a growing competitive advantage for Aecon. The depth and breadth of Aecon's capabilities also allow it to participate in projects beyond the scope of any one discipline or division. Further, leveraging capabilities and ensuring collaboration across diverse businesses allows for synergies and cost savings for both Aecon and its clients through economies of scale and resource sharing. The Company has set a goal of ongoing Adjusted EBITDA margin improvement. We will continue to be guided by a focus on the bottom-line rather than just top-line growth and on operational metrics to manage business performance in line with world-class margins - which combined with a focus on cash management and capital discipline is designed to deliver superior shareholder value. The Adjusted EBITDA margin goal represents the culmination of strategic business plans that incorporate a number of key initiatives and trends. This includes four main factors to drive a higher margin mix of business and a culture of excellence in operational performance: a)\tIncreasing higher-margin work in the Energy and Mining segments. Included in this initiative is the expectation that the Company's Energy segment revenue and backlog will increase its relative weighting and thereby make a favourable contribution to overall Adjusted EBITDA margin. As evidence of this trend, the Energy segment represented 48% of revenue in 2014 compared to 46% in 2013 and 35% in 2012; b)\tLeading partnerships and/or participating in larger scale, longer-term, more complex projects which drive higher margins, a trend that has seen revenue from joint arrangements and associates grow to over 25% of total revenue; c)\tPhasing out lower-margin general contractor and subcontractor type work previously undertaken in the Social Infrastructure sector through the Buildings and Mechanical Contracting businesses and incorporating this expertise into larger Aecon projects. This provides a competitive advantage in certain types of projects, such as subway station buildings as part of transit projects or as part of a comprehensive water and wastewater solution for clients in that sector. These various mix initiatives are expected to continue through 2015 and improve margins in the Infrastructure segment; and d)\tAchieving operational efficiencies and synergies from an ongoing focus on risk management, information technology and project control initiatives designed to ensure a more consistent and improved conversion of bid margin into final executed contract margin. The Company tracks a number of metrics evidencing the success of these initiatives, including the percentage of projects achieving bid margin, average deviation from bid margin, and overall margin realization percentage at many different levels of the Company and its operating business units. AECON GROUP INC. + ANNUAL REPORT 2014 17 3. Building Partnerships and Alliances The construction and infrastructure development industry in Canada has experienced several important changes in the competitive landscape in recent years as well as having a broad range of larger, multi-year, multi-disciplined project opportunities in both the public and private sectors. Aecon has developed a strategy of building strong partnerships and alliances, including joint arrangements and public private partnerships. The resulting importance within the industry of a company's ability to develop and manage creative relationships and alliances has provided opportunities for innovative companies such as Aecon to grow their business. In 2014, over 30 per cent of Aecon's revenue came from larger, more complex projects (over $100 million). Aecon's partnering skills have enabled it to capitalize on a number of opportunities such as its participation in the Waterloo Region Light Rapid Transit project in Ontario; Regina's new Wastewater Treatment Plant, Inter Pipeline Fund's expansion of their Cold Lake and Polaris pipelines in Alberta, John Hart hydroelectric project in British Columbia, the Darlington Refurbishment project in Ontario, and the ring road project in Edmonton, to name but a few. These and other alliances have given Aecon access to projects that are beyond any one contractor's capabilities to deliver alone. These partnerships also provide Aecon and its partners with an opportunity for exchanging and optimizing best practices with others in the industry. As an example, the Company's joint arrangement in the mainline pipeline business has already met with success in 2013 and 2014. An important element of Aecon's risk management strategy is the ongoing monitoring of projects under construction to ensure that the risk management plan established at the bid stage of the project remains sufficient and is being effectively implemented. To assist in this effort, Aecon has established a project controls team, consisting of some of Aecon's most experienced and knowledgeable staff, whose mandate is to ensure that complex projects are provided with state-of-the-art management controls for contract administration, cost control, scheduling and other best practices. This team also reviews the status of key projects against a set of pre-determined criteria, and ensures that the project is meeting its financial and risk management objectives. Particular focus for 2015 - Within this context, the Company is pursuing a number of programs and key initiatives to fulfill this strategy this year including: Continued progress on initiatives outlined above towards improving Aecon's Adjusted EBITDA margin; Continue to implement the \"One Aecon\" strategy by creating tools and incentives to drive co-ordination and cooperation between the Infrastructure, Energy and Mining Segments for large, multi-disciplinary project opportunities; Build upon Aecon's expertise in the P3 space by successfully participating in targeted strategic concession opportunities in Canada as well as developing a strategy to drive future participation in the rapidly developing P3 market in the US; 4. Focus on Execution, Performance, Operational Discipline and Risk Management Position Aecon to participate in the significant, multi-year LNG opportunities on the horizon; The ability to effectively identify, mitigate and manage the construction risk inherent in every project it undertakes, and the ability to deliver those projects in a manner that appropriately protects the safety of employees, stakeholders and the public, are key elements of success in the construction industry. Developing industry leading capabilities in these areas is a fundamental part of Aecon's strategy. Continued implementation of the initiative to standardize core operating and transactional processes and streamline and standardize key IT systems and applications; Aecon has established a detailed set of project criteria and risk management practices that are continuously reviewed, updated and improved. From the criteria set for selecting the projects it bids, to the evaluation of project risks and appropriate mitigation measures, to project pricing and the senior management approval processes a bid must go through, risk management is a strategic and operational priority for Aecon. AECON GROUP INC. + ANNUAL REPORT 2014 18 Conclude strategic initiative with respect to Aecon's interest in the Quito Airport concession; Launch of Risk Evaluation Committee to monitor cost and schedule performance, and evaluation of all major projects by Aecon's senior management team; and Launch of both the Mining the Diamond safety program to focus on high severity events and the Safety Training And Records (STAR) Program, a system to track and manage all safety related training and certificates for all employees. CONSOLIDATED FINANCIAL HIGHLIGHTS $ millions (except per share amounts) Three months ended December 31 2014 Year ended December 31 2013 2014 2013 $ Revenue $ $ $ 722.2 906.2 2,614.1 3,068.6 Gross profit 94.6 94.6 257.3 270.5 Marketing, general and administrative expenses (37.9) (34.3) (149.9) (148.0) Income from projects accounted for using the equity method 10.9 11.3 33.0 37.9 Foreign exchange gain (loss) (0.2) 0.2 0.2 0.4 Gain (loss) on sale of assets and investments (0.1) (0.9) (1.0) (0.4) Restructuring costs (6.5) - (9.0) - (2.6) - (3.2) - Depreciation and amortization Gain (loss) on mark-to-market of LTIP program (17.3) (16.3) (63.6) (63.0) Operating profit 40.9 54.6 63.7 97.3 (5.8) (10.6) (39.4) (38.3) Financing expense, net Fair value gain (loss) on convertible debentures 1.8 (7.3) 11.2 (9.8) 36.9 36.7 35.4 49.2 (8.3) (8.4) (5.4) (8.6) Profit 28.6 28.3 30.0 40.6 Profit 28.6 28.3 30.0 40.6 Profit before income taxes Income tax (expense) Exclude: Fair value (gain) loss on convertible debentures (1.8) 7.3 (11.2) 9.8 Income tax on fair value gain/loss 0.5 (1.9) 3.0 (2.6) 27.3 33.6 21.8 47.8 13.1% 10.4% 9.8% 8.8% 5.2% 3.8% 5.7% 4.8% 75.9 79.1 170.2 184.0 10.5% 8.7% 6.5% 6.0% 5.7% 6.0% 2.4% 3.2% Earnings per share - basic 0.51 0.54 0.55 0.77 Earnings per share - diluted 0.39 0.48 0.51 0.72 Adjusted earnings per share - basic 0.49 0.64 0.40 0.91 Adjusted earnings per share - diluted 0.39 0.50 0.40 0.84 2,654 1,773 Adjusted profit Gross profit margin MG&A as a percent of revenue Adjusted EBITDA Adjusted EBITDA margin Operating margin Backlog AECON GROUP INC. + ANNUAL REPORT 2014 19 Revenue for the year ended December 31, 2014 was lower by $455 million compared to 2013. In the Mining segment, revenue was lower by $190 million due primarily to lower volume of site installation work in the commodity mining sector following the completion of a major site installation project early in 2014. In the Energy sector, revenue was lower by $145 million, with the decrease occurring substantially in utilities operations in large part due to less volume from pipeline projects in Western Canada. Lower revenue was also reported in the Infrastructure segment ($128 million), with the largest decline occurring in social infrastructure and reflecting the previously announced strategy to reduce activity in this business while focusing resources on higher margin opportunities. In addition, revenue in each of the Infrastructure, Energy and Mining segments was impacted in 2014 by longer than anticipated securing and ramp-up of new projects. Most of the delays experienced related to the availability of required permits, status of third party design and engineering not being sufficiently advanced, and in some cases delays caused by hand-over of sites from other contractors. In addition, severe winter weather in Ontario also affected the start of road building and other seasonal work in 2014. Operating profit of $63.7 million in 2014 decreased by $33.6 million compared to 2013 primarily due to the above noted lower revenue in 2014. Gross profit margin increased in 2014 to 9.8% from 8.8% in 2013, but overall gross profit decreased by $13.2 million compared to the prior year. Gross profit decreased by $24.6 million in the Energy segment, and by $14.2 million in the Mining segment, primarily from the above noted lower volume in both segments. These decreases were partially offset by an increase in gross profit in the Infrastructure segment of $22.4 million, generally due to higher margins in transportation and heavy civil operations, more than offsetting lower revenue in the segment in 2014. Marketing, general and administration costs (\"MG&A\") increased by $1.9 million in 2014 compared to 2013 and MG&A as a percentage of revenue increased from 4.8% to 5.7%. The increase in MG&A costs was driven primarily by higher bid costs, partially offset by lower employee incentive costs, and lower professional and consulting fees. Higher MG&A as a percentage of revenue in 2014 reflects lower annual revenue compared to 2013. AECON GROUP INC. + ANNUAL REPORT 2014 20 Aecon's participation in projects which are classified for accounting purposes as a joint venture or an associate, as opposed to a joint operation, are accounted for using the equity method. For the year ended December 31, 2014, income from projects accounted for using the equity method was $4.9 million lower than in 2013. A $5.9 million decrease across the Infrastructure, Energy and Mining segments was due mainly to a lower volume of work performed through this type of project structure in 2014. This reduction was partially offset by a $1.0 million increase in income from Quito operations in the Concessions segment. Restructuring costs of $9.0 million in 2014 consist primarily of personnel and other costs associated with an organizational restructuring which impacted each of the Infrastructure, Energy and Mining segments in the fourth quarter of 2014 ($6.5 million). Restructuring costs also include a loss on disposal of a subsidiary of $2.6 million in the first quarter of 2014 that resulted from the closure of the buildings business unit in Seattle within the Infrastructure segment. In 2014, the net mark-to-market loss related to the longterm incentive plan (\"LTIP\") program was $3.2 million. This loss results from re-measuring both the LTIP liability and related total return swaps (\"TRS\") at fair value at each reporting date. The LTIP includes awards to participants made in the form of phantom share awards with the value of such awards tied to the trading price of Aecon common shares. The related LTIP liability is re-measured at each reporting date at fair value until settled. The Company has a number of TRS outstanding that are intended to reduce the variability of cash flows and, to a lesser extent, earnings associated with stock-based compensation awards that will settle in cash. The value of the TRS is also tied to the trading price of Aecon common shares and is also re-measured at fair value at each reporting date. With the movement in Aecon's common share price since the inception of the new phantom share plan in the third quarter of 2014, the reduction in the LTIP liability was more than offset by a higher obligation related to the TRS outstanding at year end. Depreciation and amortization expense of $63.6 million in 2014 was $0.6 million higher than in 2013. The increase occurred in the Energy and Infrastructure segments, primarily from capital additions in utilities and transportation operations. Financing charges, net of interest income, of $39.4 million in 2014 were $1.1 million higher than in 2013. The increase in financing cost was due primarily to higher interest expense on convertible debentures issued in the fourth quarter of 2013 and offset in part by lower interest expense associated with convertible debentures that matured in the third quarter of 2014. The terms of the Company's convertible debentures that mature in 2015 include an option for holders to convert prior to the maturity date and allow the Company the option to settle the conversion in cash (or a combination of cash and common shares) unless a holder expressly indicates in the conversion notice that they do not wish to receive cash. The conversion option is treated as a derivative liability which must be measured at fair value at each reporting period, with gains and losses flowing through profit or loss. In 2014, the fair value gain was $11.2 million compared to a loss of $9.8 million in 2013. For more information, refer to Note 18 of the 2014 consolidated financial statements. Set out in Note 19 of the 2014 consolidated financial statements is a reconciliation between the expected income tax expense in 2014 and 2013 based on statutory income tax rates and the actual income tax expense reported for both these periods. Further details for each of the segments are included in the discussion below under Reporting Segments. BACKLOG As at December 31 $ millions 2014 $ $ Infrastructure 1,263 820 Energy 955 876 Mining 436 77 2,654 1,773 Consolidated 2013 New contract awards of $3,495 million were booked in 2014 compared to $2,413 million in 2013. Further details of backlog for each of the segments are included in the discussion below under Reporting Segments. Backlog duration, representing the expected period during which backlog on hand will be converted into revenue, is included in the table below: ESTIMATED BACKLOG DURATION As at December 31 $ millions 2014 2013 $ Next 12 months 1,578 Next 13-24 months Beyond $ 59% 1,067 60% 817 31% 556 31% 259 10% 150 9% 2,654 100% 1,773 100% Aecon does not report, as backlog, the significant number of contracts and arrangements in hand where the exact amount of work to be performed cannot be reliably quantified or where a minimum number of units at the contract specified price per unit is not guaranteed. Examples include time and material and some cost-plus and unit priced contracts where the extent of services to be provided is undefined or where the number of units cannot be estimated with reasonable certainty. Other examples include the value of construction work managed under construction management advisory contracts, concession agreements, multi-year operating and maintenance service contracts where the value of the work is not specified, supplier of choice arrangements and alliance agreements where the client requests services on an as-needed basis. None of the expected revenues from these types of contracts and arrangements are included in backlog. Therefore, Aecon's effective backlog at any given time is greater than what is reported. Reported backlog includes the revenue value of backlog that relates to projects that are accounted for using the equity method. The equity method reports a single amount (revenue less expenses) on Aecon's consolidated statement of income, and as a result the revenue component of backlog for these projects is not included in Aecon's reported revenue. AECON GROUP INC. + ANNUAL REPORT 2014 21 REPORTING SEGMENTS Infrastructure FINANCIAL HIGHLIGHTS Three months ended December 31 Year ended December 31 $ millions 2014 $ $ $ $ Revenue 238.9 277.9 871.9 1,000.0 Gross profit 26.6 13.9 57.9 35.4 Adjusted EBITDA 21.0 4.6 25.5 (1.2) Operating profit (loss) 14.9 0.2 4.4 (18.2) Adjusted EBITDA margin 8.8% 1.7% 2.9% (0.1)% Operating margin 6.2% 0.1% 0.5% (1.8)% 1,263 820 Backlog For the year ended December 31, 2014, revenue in the Infrastructure segment of $872 million was $128 million, or 13%, lower than in the previous year. Revenue was higher in heavy civil operations ($61 million) following several new project awards in 2014. Offsetting this was lower revenue in social infrastructure ($142 million) primarily due to the impact of a strategic shift away from lower margin buildings and mechanical work, and towards opportunities such as water and wastewater treatment projects, as well as from the closure of the Seattle operations in the first quarter of 2014. Revenue was also lower in transportation ($47 million), primarily from reduced volume in both Western and Central Canada. As noted previously, revenue in the Infrastructure segment was also impacted in 2014 from delays in ramp up of new projects during the year. For the year ended December 31, 2014, operating profit in the Infrastructure segment was $4.4 million, an increase of $22.6 million compared to an operating loss of $18.2 million in 2013. The largest improvement occurred in transportation operations, mostly due to the impact of the segment's share of a specific project provision in 2013, as well as from higher margins in Western Canada in 2014. Operating profit also increased in heavy civil operations primarily due to higher revenue combined with higher margins in 2014. These improvements were partially offset by lower operating profit in social infrastructure due to the AECON GROUP INC. + ANNUAL REPORT 2014 22 2013 2014 2013 above noted decrease in revenue in this sector. Operating profit in Infrastructure also reflects the impact of a $2.6 million charge incurred as a result of the closure of the Seattle operations in 2014 and $1.9 million of restructuring costs associated with organizational restructuring in the fourth quarter of 2014. Infrastructure backlog at December 31, 2014 was $1,263 million, which is $443 million higher than the previous year with most of the increase occurring in transportation ($228 million) and heavy civil ($236 million) operations. New contract awards totaled $1,314 million in 2014 compared to $700 million in the prior year. The increase in new awards reflects the impact of several large project awards announced in 2014 including the York Viva Bus Rapid Transit project, the Second Concession Road project, and the Highway 410 project all in Ontario in transportation; the John Hart Generating Station project in British Columbia in heavy civil; and the Waterloo LRT Light Rail Transit project in both heavy civil and transportation; along with Regina's new Wastewater Treatment Plant in social infrastructure. As discussed in the Consolidated Financial Highlights section, the Infrastructure segment's effective backlog at any given time is greater than what is reported. Energy FINANCIAL HIGHLIGHTS Three months ended December 31 Year ended December 31 $ millions 2014 $ $ $ $ Revenue 340.5 466.4 1,251.4 1,396.4 Gross profit 38.3 64.6 128.5 153.1 Adjusted EBITDA 22.6 53.3 72.4 97.4 Operating profit 17.2 49.6 56.6 84.1 Adjusted EBITDA margin 6.6% 11.4% 5.8% 7.0% Operating margin 5.0% 10.6% 4.5% 6.0% 955 876 Backlog For the year ended December 31, 2014, revenue in the Energy segment of $1,251 million was $145 million, or 10%, lower than the previous year, with substantially all of the lower revenue occurring in utilities. Revenue from utilities operations was lower by $146 million, primarily due to lower volume from pipeline projects in Western Canada, whereas revenue from industrial operations in 2014 was comparable to the previous year (higher by $1 million). In industrial, higher revenue in Western Canada ($25 million) reflected an increase in site construction projects in the resource sector due to new awards and scope growth on existing projects, partially offset by a decrease in fabrication and module assembly work. Revenue from industrial operations was also higher in Atlantic Canada ($18 million) due to an increased volume of fabrication projects, and in IST ($9 million) due to higher sales of heat recovery steam generators and an increase in service revenue. These increases in industrial operations were offset by lower revenue in Central Canada ($49 million) primarily from project delays in the power sector. For the year ended December 31, 2014, operating profit of $56.6 million decreased by $27.5 million compared to the previous year. In utilities, despite lower revenue, operating profit improved slightly year-over-year due in large part to the impact of the segment's share of a specific project 2013 2014 2013 provision in 2013, as well as from higher margins in Western Canada in 2014. As such, the decrease in segment operating profit occurred in industrial operations, and resulted primarily from lower profit in both Western and Central Canada. The decrease in Western Canada was largely the result of lower margins from site construction projects, while the decrease in Central Canada was primarily volume driven. Segment operating profit was also impacted by $1.8 million in restructuring costs associated with organizational restructuring in the fourth quarter of 2014. Backlog at December 31, 2014 of $955 million was $79 million higher than the previous year. Backlog increased in industrial operations by $186 million primarily from new contract awards in Western Canada in the resources sector, which offset lower backlog in utilities operations ($107 million) as a result of significant work off of pipeline projects in Western Canada. New contract awards of $1,331 million in 2014 were $56 million higher than in 2013. Most of the increase in new awards occurred in industrial operations in Western Canada and in IST. As discussed in the Consolidated Financial Highlights section, the Energy segment's effective backlog at any given time is greater than what is reported. AECON GROUP INC. + ANNUAL REPORT 2014 23 Mining FINANCIAL HIGHLIGHTS Three months ended December 31 Year ended December 31 $ millions 2014 $ $ $ $ Revenue 153.0 169.4 516.1 705.8 Gross profit 30.5 20.5 72.5 86.7 Adjusted EBITDA 25.0 22.3 49.2 74.5 Operating profit 16.2 14.8 20.7 48.0 Adjusted EBITDA margin 16.3% 13.2% 9.5% 10.6% Operating margin 10.6% 8.7% 4.0% 6.8% 436 77 Backlog 2013 2014 2013 For the year ended December 31, 2014, revenue in the Mining segment of $516 million was $190 million, or 27%, lower than in the previous year. A substantial portion of the decrease was due to lower volume of site installation work in the commodity mining sector ($186 million) due to initial delays experienced early in 2014 in securing and then ramping up new project awards, combined with the substantial completion of several projects since the end of 2013. Lower revenue in 2014 was also the result of lower volume of contract mining services in the oil sands ($60 million) as operations were significantly impacted by temporary client production shutdowns during 2014. These decreases were partially offset by higher revenue from civil and foundations work related to mining projects ($56 million) in Western Canada. the commodity mining sector and in contract mining, partially offset by an increase in operating profit from civil and foundations work. Segment operating profit was also impacted by $0.9 million in restructuring costs associated with organizational restructuring in the fourth quarter of 2014. For the year ended December 31, 2014, operating profit of $20.7 million decreased by $27 .3 million compared to the previous year. The decrease in operating profit was largely due to the above noted volume reductions in both As discussed in the Consolidated Financial Highlights section the Mining segment's effective backlog at any given time is greater than what is reported. AECON GROUP INC. + ANNUAL REPORT 2014 24 Backlog at December 31, 2014 of $436 million was $359 million higher than the previous year. New contract awards of $875 million in 2014 were $403 million higher than in 2013. The increase in backlog and new awards was largely due to project awards with a potash customer in the commodity mining sector as well as new awards in the contract mining sector, including a large mining site development project award at the Fort Hills project in Alberta. Concessions FINANCIAL HIGHLIGHTS Three months ended December 31 Year ended December 31 $ millions 2014 $ $ $ $ Revenue 0.8 1.0 2.9 3.0 Gross profit (0.8) (4.4) (1.6) (4.7) Income from projects accounted for using the equity method 5.8 5.0 24.6 23.6 Adjusted EBITDA Operating profit Revenue reported in the Concessions segment for the years ended December 31, 2014 and 2013, was $2.9 million and $3.0 million, respectively. For the year ended December 31, 2014, operating profit of $18.7 million represents a $2.1 million increase compared to the prior year. The increase is due to higher revenue and profitability from the Quiport JV following the transition of operations from the old Quito airport to the new Quito airport in February 2013, including higher year-over-year passenger traffic associated with the first full year of operations. This increase more than offset higher amortization and interest expense in the Quiport 2013 2014 2013 11.8 7.5 48.4 39.8 3.3 0.2 18.7 16.6 JV. Following the opening of the new Quito airport on February 20, 2013, the project commenced expensing interest (whereas prior to the opening of the new Quito airport, interest was being capitalized) and began amortizing airport assets that were put into service as of that date. Approximately 2.8 million passengers departed through the Quito airport in 2014, a 2.3% increase over 2013. Aecon does not include in its reported backlog expected revenue from operations management contracts and concession agreements. As such, while Aecon expects future revenue from its concession assets, no concession backlog is reported. AECON GROUP INC. + ANNUAL REPORT 2014 25 QUARTERLY FINANCIAL DATA Set out below is quarterly financial data for the most recent eight quarters: $ millions (except per share amounts) 2014 2013 Quarter 4 Revenues Quarter 3 Quarter 2 Quarter 1 Quarter 4 Quarter 3 Quarter 2 $ $ $ $ $ $ $ Quarter 1 $ 722.2 840.4 589.6 461.9 906.2 897.3 697.6 567.5 Adjusted EBITDA 75.9 77.3 13.9 3.1 79.1 79.5 36.7 (11.3) Earnings (loss) before income taxes 36.9 51.3 (16.8) (36.0) 36.7 45.1 9.4 (42.0) Profit (loss) 28.6 39.5 (12.2) (25.9) 28.2 34.4 7.9 (29.9) Adjusted profit (loss) 27.3 33.1 (13.9) (24.7) 33.6 36.5 6.0 (28.3) Basic 0.51 0.73 (0.23) (0.49) 0.54 0.65 0.15 (0.56) Diluted 0.39 0.49 (0.23) (0.49) 0.48 0.53 0.13 (0.56) Basic 0.49 0.61 (0.26) (0.47) 0.64 0.69 0.11 (0.53) Diluted 0.39 0.49 (0.26) (0.47) 0.50 0.53 0.11 (0.53) Earnings (loss) per share: Adjusted earnings (loss) per share: Earnings (loss) per share for each quarter has been computed using the weighted average number of shares issued and outstanding during the respective quarter. Any dilutive securities, which increase the earnings per share or decrease the loss per share, are excluded for purposes of calculating diluted earnings per share. Due to the impacts of dilutive securities, such as convertible debentures, and share issuances throughout the periods, the sum of the quarterly earnings (losses) per share will not equal the total for the year. Set out below is the calculation of Adjusted EBITDA for the most recent eight quarters: $ millions 2014 2013 Quarter 4 Quarter 3 Quarter 2 Quarter 1 Quarter 4 Quarter 3 Quarter 2 Quarter 1 $ $ $ $ $ $ $ $ Operating profit (loss) 40.9 53.8 (7.8) (23.2) 54.6 57.6 16.2 (31.1) Depreciation and amortization 17.3 15.3 14.1 16.8 16.3 15.0 14.3 17.5 0.1 0.3 0.5 - 0.9 - (0.3) (0.2) (Gain) loss on sale of assets and investments Restructuring costs 6.5 - - 2.6 - - - - Loss on mark-to-market of LTIP program 2.6 0.6 - - - - - - (10.9) (8.2) (6.6) (7.3) (11.3) (9.5) (8.6) (8.4) JV EBITDA 19.4 15.5 13.6 14.2 18.7 16.5 15.1 10.9 Adjusted EBITDA 75.9 77.3 13.9 3.1 79.1 79.5 36.7 (11.3) Quarter 2 Quarter 1 Income from projects accounted for using the equity method Set out below is the calculation of JV EBITDA for the most recent eight quarters: $ millions Aecon's proportionate share of projects accounted for using the equity method(1) 2014 Quarter 4 Quarter 3 2013 Quarter 2 Quarter 1 Quarter 4 Quarter 3 $ Operating profit Depreciation and amortization JV EBITDA $ $ $ $ $ $ $ 15.7 11.9 10.0 10.6 15.2 13.2 11.8 9.8 3.7 3.6 3.6 3.7 3.5 3.3 3.3 1.1 19.4 15.5 13.6 14.2 18.7 16.5 15.1 10.9 (1) Refer to Note 11 \"Projects Accounted for Using the Equity Method\" in the 2014 consolidated financial statements AECON GROUP INC. + ANNUAL REPORT 2014 26 QUARTERLY FINANCIAL HIGHLIGHTS Three months ended December 31 Revenue Operating profit (loss) $ millions 2014 $ $ $ $ Infrastructure 238.9 277.9 14.9 0.2 Energy 340.5 466.4 17.2 49.6 Mining 153.0 169.4 16.2 14.8 0.8 1.0 3.3 0.2 Concessions 2013 2014 2013 Other costs and eliminations (11.0) (8.5) (10.7) (10.2) Consolidated 722.2 906.2 40.9 54.6 The analysis of operating results for each of the first three quarters of 2014 is included in Management's Discussion and Analysis incorporated in the Interim Reports to Shareholders for each respective quarter. Infrastructure segment revenue in the fourth quarter of 2014 was $39 million, or 14%, lower than in the fourth quarter of 2013. The largest revenue decline in the quarter occurred in transportation operations ($42 million), primarily from a lower volume of road building work in Ontario and Western Canada. Consistent with the pattern throughout the year, revenue was also lower in social infrastructure ($35 million) as a result of the strategy to reduce activity in this business as discussed in the Infrastructure Financial Highlights section. Partially offsetting these declines was higher revenue in heavy civil operations ($38 million) primarily driven by new project awards in the power sector in Western Canada and from civil transportation infrastructure work in Ontario. Operating profit in the Infrastructure segment of $14.9 million in the fourth quarter of 2014 increased by $14.7 million compared to the fourth quarter of 2013. The majority of this increase occurred in heavy civil, primarily from higher volume and margin improvement. Operating profit also increased in transportation which despite lower revenue, benefitted from higher margins on road building activity in both Ontario and Western Canada. These improvements were partially offset by a decrease in social infrastructure operating profit due to lower volume quarterover-quarter. Segment operating profit was also impacted in the fourth quarter of 2014 by $1.9 million in