Highlights
Strong Operating Growth: Total revenue and operating income increased 15.9% in Q4 and 14.0% for the year, driven primarily by a $73.2 million net unrealized gain on Partner investments (2024, $47.3 million). Earnings from operations increased 34.8% in Q4 and 17.3% for the year.
Net Book Value Growth in 2025: Net book value(4) per unit increased $0.64 in 2025 to $24.79, despite a $1.13 per unit unrealized foreign exchange loss and the payment of $1.39 in distributions. Net book value decreased $0.38 per unit from Q3 2025 due primarily to foreign exchange movements and $0.37 distributions declared.
Cash Flow & Payout Discipline: Alaris Net Distributable Cash Flow(1) decreased 24.6% in Q4 and 16.1% for the year, reflecting timing and variability in common distributions, timing of cash tax payments and transaction activity. Alaris' Payout Ratio(5) was 56.6% for the year (Q4: 64.2%), remaining below the Trust's 65%–70% target range.
Embedded Distribution Growth: Based on unaudited Partner results, Alaris estimates an average positive reset of approximately 4.0% on annual preferred distributions resetting in 2026, resulting in approximately $4.8 million (approximately $0.11 per unit) of incremental Run Rate Revenue(6).
Partner Revenue Ahead of Guidance: Q4 total Partner revenue of $45.8 million exceeded guidance by 5%, reflecting contributions from new investments in Renew and Optimus and higher-than-expected common distributions.
Active Capital Deployment: Alaris invested a record $387.4 million during 2025, including $115.5 million in Optimus and US$50.5 million across Renew and Cresa in Q4.
Distribution Increase: In Q4 2025, Alaris announced an ~9% increase to the quarterly dividend to $0.37 per unit (annualized $1.48). The increase in the distribution was supported by strong capital deployment and the Payout Ratio below the Trust's targeted range.
Portfolio Fundamentals: Alaris' Portfolio Partners have maintained a weighted average Earnings Coverage Ratio(3) of 1.5x, over the year with 15 of 23 Partners above 1.5x. Fifteen Partners carry no debt or less than 1.0x senior debt to EBITDA.
Strengthened Capital Structure: The Trust extended the senior credit facility maturity to September 2029 and issued $207.0 million of convertible debentures during the year to support continued investment activity and balance sheet flexibility.
President's Message
2025 represented a record year for Alaris in many different categories. We closed the year with 23 private company partners after deploying $385 million of capital, both all time records. In addition, our book value per share reached an all-time high of $25.10 during the year. Underlying this record performance is a portfolio that continues to provide remarkable stability, even in a less than stable world. Our earnings coverage across our portfolio has remained strong, debt levels within the portfolio remain low and we recorded the 21st year of increased partner distributions in our 22nd year of operations, a track record I am incredibly proud of. In 2025, we increased our distribution by 9% reflecting strong capital deployment and continued partner growth. With our Payout Ratio below our targeted 65%-70% range and a positive outlook for our business in 2026 and beyond, we remain committed to our capital allocation priorities, including high-return capital deployment, a strong and sustainable dividend, and opportunistic share repurchases.
Looking forward, the current environment within the private equity industry remains constructive for Alaris. While visibility for 2026 is limited, I believe that our place within the industry has never been better in terms of reputation and the differentiation of our offering to business owners. While many private equity firms in North America that specialize in the lower to mid-market have had a difficult time raising new capital over the last couple of years, Alaris is in an enviable position given our access to both public and private capital to fuel our future growth.
I would also like to take this opportunity to thank our incredibly hard-working staff. The kind of results that we have put up over many years do not happen without an extreme amount of dedication from our team. Alaris' overhead is well below 1% of our roughly $2.5 billion in assets under administration, which would be considered very low in our industry where managers are typically charging 1.5-2.0%.
I look forward to another record year developing in 2026. Thank you to our unitholders for their continued confidence and support.
Results of operations
Three months ended December 31
Year ended December 31
$ thousands except per unit amounts
2025
2024
% Change
2025
2024
% Change
Change in Net book value (1) per unit
$ (0.38)
$ 1.35
$ 0.64
$ 3.03
Net book value (1) per unit
$ 24.79
$ 24.15
+2.7%
$ 24.79
$ 24.15
+2.7%
Total revenue and operating income
$ 30,911
$ 26,666
+15.9%
$ 176,701
$ 154,989
+14.0%
Cash from / (used in) operations, prior to changes in working capital
$ (86,831)
$ 15,739
-651.7%
$ (113,342)
$ 61,344
-284.8%
Total Partner distribution revenue (1)
$ 45,107
$ 46,328
-2.6%
$ 187,221
$ 192,071
-2.5%
Alaris net distributable cashflow (1)
$ 24,016
$ 31,856
-24.6%
$ 109,430
$ 130,486
-16.1%
Payout Ratio (1)
64.2%
48.7%
+30.6%
56.6%
47.5%
+21.3%
Annualized distribution yield on preferred capital invested (1)
13.2%
14.8%
-160pts
12.2%
13.9%
-170pts
Total value return on capital invested (1)
3.4%
3.7%
-30pts
19.2%
18.1%
+110pts
Capital Deployment
$ 188,072
$ 205,915
-8.7%
%
$ 387,390
$ 331,793
+16.8%
Revenue and Earnings
Total revenue and operating income increased 15.9% in Q4 and 14.0% for the year compared to 2024. The increase was primarily attributable to net unrealized fair value gains on Partner investments, and contributions from new and follow-on investments.
Earnings and comprehensive income was a loss of $0.2 million in Q4 2025 (Q4 2024: $77.9 million) and $90.8 million for the year (2024: $234.4 million). The decrease was primarily due to unrealized foreign exchange losses of $20.0 million in Q4 and $51.2 million for the year, compared to unrealized gains in 2024, as well as the absence of the non-recurring accounting transition gain recognized in 2024. Excluding these items, earnings increased year-over-year.
Partner Distributions and Portfolio Performance
Total Partner distribution revenue(9) decreased 2.6% in Q4 and 2.5% for the year, reflecting lower common distributions and deferred distributions from GWM, partially offset by contributions from new and follow-on investments including Berg, PEC, McCoy, Shipyard, Cresa, Renew and Optimus. Excluding Fleet's US$10.3 million common distribution in 2025 (2024, US$14.7 million) and Ohana's one-time US$5.1 million common distribution in 2024, common distributions from the remaining portfolio increased approximately 10% year-over-year.
The annualized distribution yield on preferred capital invested(2) was 12.4% for both Q4 and the year.
Total value return on invested capital was 3.1% for Q4 and 16.2% for the year, reflecting recurring cash distributions and fair value adjustments.
Cash Flow and Capital Allocation
Cash from operations prior to changes in working capital decreased year-over-year, primarily reflecting the deployment of Convertible debenture proceeds into the Acquisition Entities to reduce senior debt.
Alaris Net Distributable Cash Flow(1) decreased 24.6% in Q4 and 16.1% for the year, reflecting variability in common distributions, timing of cash tax payments and transaction activity. The payout ratio was 64.2% in Q4 and 56.6% for the year, remaining below the Trust's target range of 65%–70%.
During 2025, the Trust repurchased and cancelled 465,000 units under its NCIB at an average price of $18.87 per unit for total consideration of $8.8 million.
Outlook
Total Partner revenue(9) for Q1 2026 is expected to be approximately $46.9 million, reflecting seasonal distribution timing, recent investment activity and a 4% preferred distribution reset increase in distributions eligible for reset in 2025.
Run Rate Revenue(6) for the next twelve months is estimated at approximately $200.1 million, based on current contractual terms. Run Rate Payout Ratio(8) is expected to range between 60% and 65%, excluding the impact of potential future investments.
Run Rate Cash Flow ($ thousands except per unit)
Amount ($)
$ / Unit
Run Rate Revenue, Partner Distribution revenue
$ 200,100
$ 4.41
General and administrative expenses
(20,500)
(0.45)
Third party Interest and taxes
(74,300)
(1.64)
Alaris Distributable Cashflow
$ 105,300
$ ...
