Calnex Solutions (CLX) H2 2026 earnings summary

Executive summary

• Revenue increased 19% year-over-year to just under £23 million (£21.9m), with substantial profit growth and a strong cash position at year-end.

• Business diversification accelerated, with significant expansion into digital infrastructure and government/defense sectors.

• Repeat business remains high, with 70–80% of orders from existing customers and top 10 customers averaging 13-year relationships.

• Major product launches included the Paragon S (800 Gb), the first 400 Gb network emulation platform, and ongoing investment in next-gen 1.6 Tb technology.

• Strategic partnerships, notably with VIAVI, are strengthening go-to-market capabilities and expected to drive future growth.

Financial highlights

• Gross margin increased to 76%, maintaining strong profitability.

• Underlying EBITDA margin rose to 8% from 6% year-over-year; profit before tax reached £1.2 million, up from £0.7 million.

• Year-end cash was £9.3 million, with post-year-end collections raising cash to £11.2 million.

• Net cash inflow from operating activities was £5.5 million, higher than the previous year.

• Dividend increased from £0.62 to £0.68 per share.

Outlook and guidance

• FY 2027 is positioned as a year of investment, with low single-digit revenue growth expected and a focus on advancing key development programs.

• FY 2028 is projected to see low double-digit revenue growth, driven by new product launches and market diversification.

• Operating margins are targeted to return to double digits in future years as diversification strategies mature.

• Accelerated growth anticipated from FY 2028 onward, supported by a robust product roadmap and continued sector expansion.

• Telecoms market stable; not reliant on telecoms for growth due to traction in newer verticals.