Rosebank Industries (ROSE) H1 2026 earnings summary

Executive summary

• H1 trading was ahead of recently upgraded FY26 expectations; adjusted operating profit and EPS are expected to exceed market expectations.

• Integration and improvement plans are progressing across ECI, CPM and MW Components, with strong underlying cash flows and margin opportunity.

• FY26 profit and net debt expectations were upgraded for the second time; bolt-on acquisitions completed in CPM and MW Components, with advanced discussions in ECI.

• The investment strategy targets at least doubling shareholder investment over a three-to-five-year holding period.

• First interim dividend declared at 2.1 cents per share.

Financial highlights

• H1 revenue was $733m, adjusted operating profit $110m, adjusted profit after tax $74m and adjusted diluted EPS 10.3 cents.

• Statutory operating loss was $34m and loss after tax $52m, reflecting $144m in adjusting items, including acquisition costs, restructuring and mainly non-cash items.

• Adjusted operating profit of $110m converted to $113m adjusted free cash flow; free cash flow after restructuring costs was $88m.

• Net debt at 30 June 2026 was $1,069m, with leverage of 2.4x; acquisitions increased net debt by $639m.

Outlook and guidance

• FY26 adjusted operating profit and EPS are expected to exceed recently upgraded market expectations; consensus was revenue of $1,972m and adjusted operating profit post-PLC costs of $314m.

• FY26 net debt and leverage are expected to be ahead of current market expectations; strong order intake at CPM and MW Components supports the profit outlook.

• Annual corporate costs guided at ~$30m, adjusted tax at ~26%, weighted average cash cost of gross debt at ~5.9%, and 2026 LTIP charge at $15m.

• Capital expenditure guided at ~1.3x owned-asset depreciation; 2026 non-cash interest charge guidance is $15m.

• Medium-term adjusted operating margin targets are 18%+ for ECI, 21%-22% for MW Components and 28%-29% for CPM.