COSOL (COS) H1 2026 earnings summary

Executive summary

• Revenue declined 14.1% year-over-year to $49.6 million in H1 FY26, with underlying EBITDA down 57% to $3.5 million, ending a previously strong growth trajectory due to subdued demand in natural resources, contract losses, and underutilization of staff.

• Operational reset included restructuring, cost reductions (~$1 million annualized from H2), leadership changes, and a renewed focus on sales and operational integration, with early signs of stabilization and recovery.

• Strategic focus shifted to digital and data services, with OnPlan SaaS ARR doubling to $3.1 million since acquisition and integration of Toustone AI/data business to pursue mass transportation contracts.

• Two new multi-year managed services contracts were won in the U.S., expected to support second-half revenue.

• No interim dividend declared for the period as part of capital preservation.

Financial highlights

• Revenue: $49.6 million (down 14.1% year-over-year); underlying EBITDA: $3.5 million (down 57% year-over-year); net loss after tax: $0.29 million (prior year: $4.05 million profit).

• Gross margin compressed to 28.8% from 31.5% year-over-year; underlying EBITDA margin fell to 7.1% from 14.1%.

• Asset Management Services revenue declined 26.3% to $15.9 million, mainly due to weaker coal sector demand and contract changes.

• Consulting segment revenue declined 6.8% to $27.6 million, impacted by project wind-downs, delayed starts, and contract terminations.

• Operating cash flow (excluding interest and tax) was $7.7 million, up 294% due to improved debtor collection; net debt reduced to $20.7 million.

Outlook and guidance

• Management expects revenue and earnings recovery in H2 FY26, supported by improved utilization, new contract wins, and cost discipline.

• Managed Services is projected to achieve 10% annualized growth in 2027, with margins approaching 40%.

• Continued investment in digital and data services, especially in public infrastructure and Americas markets.

• Further guidance will be provided in early Q4 as momentum builds.