ALS (ALQ) H1 2026 earnings summary

Executive summary

• Revenue grew 13.3% year-over-year to AUD 1.7 billion ($1,659.6 million), with 6.9% organic growth, acquisition contributions, and FX tailwinds; all business streams delivered positive organic growth, led by Commodities and Life Sciences.

• Underlying EBIT rose 14.7% to AUD 287.2 million, with EBIT margin up 20 bps to 17.3%; underlying NPAT increased 17.2% to AUD 178.4 million; statutory NPAT up 11.8% to AUD 141.7 million.

• Free cash flow was AUD 303.9 million, representing 88% of underlying EBITDA, up 10.8% year-over-year.

• Interim dividend of AUD 0.194 per share (19.4 cps) declared, up 2.6%-3%, partially franked, with a 55% payout ratio.

• Digital innovation and AI initiatives advanced, enhancing operational efficiency and client solutions; strong balance sheet with reduced net debt and liquidity exceeding $550 million.

Financial highlights

• Organic revenue growth was 6.9%, at the top end of guidance; FX contributed 4.2% to revenue growth.

• Underlying EBIT: AUD 287.2 million, up 14.7%; EBIT margin at 17.3%.

• Free cash flow: AUD 303.9 million; EBITDA cash conversion at 88%; base CapEx AUD 89 million (145% of depreciation, 5.4% of revenue).

• Leverage reduced to 1.8x post AUD 370 million equity raise; EBITDA interest cover at 10.2x; weighted average debt maturity 4.4 years, 83% of debt fixed at 3.7%-3.79%.

• Underlying ROCE steady at 19.4%; DSO improved to 51 days; DPO steady at 63 days.

Outlook and guidance

• Upgraded organic revenue growth guidance for FY26 to 6%-8% (from 5%-7%); margin improvement expected.

• Commodities organic revenue growth guidance raised to 12%-14% for FY26, with expected margin expansion of 100-125 bps in H2.

• Life Sciences organic revenue growth guidance revised down to 4%-6% for FY26, with continued margin improvement targeted.

• FY27 targets: AUD 3.3 billion revenue, AUD 600 million EBIT, 19% EBIT margin floor; underlying NPAT phasing expected to be 48% H1 / 52% H2.

• Commodities expected to benefit from electrification trends and downstream expansion; Life Sciences to grow market share via regulatory trends and acquisitions.