COSOL (COS) H2 2026 earnings summary

Executive summary

• Interim CEO appointed after the previous MD/CEO's resignation, with the Chairman stepping into an executive role to support leadership transition and growth initiatives.

• Operating profitability rebounded in H2 FY26, with underlying EBITDA of $9.8 million for the year and $6.3 million in H2, driven by margin recovery in data and digital consulting.

• Leadership changes are part of a broader strategy to restore profitable organic revenue growth and shareholder value after unsatisfactory recent results.

• Recent contract wins in Australia and Canada, especially in mass transportation, provide a platform for FY27 growth.

• Revenue for FY26 was $98.6 million, down 15.6% year-over-year, but stabilized in H2.

Financial highlights

• Underlying EBITDA for FY26 was $9.8 million, with $6.3 million generated in H2.

• EBITDA margin improved by 570 basis points in H2 to 12.8%, driven by cost base reset and margin recovery in data and digital consulting.

• Net debt reduced to $20 million, with a cash position of $5.3 million and cash conversion of 108%.

• Statutory net loss of $4.02 million due to $6.5 million in goodwill impairment charges.

• Gross margin for FY26 was 30.0%, with H2 gross margin recovering to 37.9%.

Outlook and guidance

• FY27 focus is on driving profitable organic revenue growth, leveraging recent high-margin, multi-year contract wins in transportation and infrastructure.

• Americas IBM Maximo contracts expected to grow from 25% of FY26 revenue to about 45% in FY27.

• Five-point plan includes expanding transport sector revenue, growing AI revenue, and building on American sales growth.

• Initial positive revenue momentum noted in Q1 FY27, with new sales hires anticipated to impact revenue from H2 FY27.

• Earnings guidance for H1 FY27 will be provided at the AGM in November.