SciDevL (SDV) H1 2026 earnings summary

Executive summary

• Revenue and earnings for 1H FY26 fell below expectations, declining to $47.9m with underlying EBITDA at $1.1m, due to disruptions in Energy Services and higher costs in international Water Technologies.

• Key challenges included a major customer disruption in Energy Services, underperformance in international Water Technologies, and abnormal costs from restructuring and due diligence.

• Strategic actions included broadening the customer base, shifting to a channel partner model internationally, and reducing corporate costs.

• Recurring revenue increased to 54% of total revenue, driven by long-term contracts and CatChek sales, improving earnings quality and visibility.

• Process Chemistry achieved record revenues, and APAC Water Technologies returned to profitability.

Financial highlights

• Revenue for 1H FY26 was $47.9m, down 4% year-over-year, with gross margin declining to 28% from 33%.

• Underlying EBITDA was $1.1m, with a significant negative impact from reduced xSlik sales and higher international costs; reported EBITDA dropped to $0.4m.

• Net cash at 31 Dec 2025 was $4.4m, with $6m in unutilized debt facilities and total cash of $7.5m.

• Cost reduction initiatives delivered $0.7m in savings for the half, with $1.3m in annualized fixed cost reductions expected.

• Underlying NPAT was a loss of $1.4m, and net loss after tax was $2.1m, compared to a small loss or profit in the prior period.

Outlook and guidance

• FY26 revenue guidance revised to $100m–$110m due to delayed xSlik sales, trial conversion delays, and a $3m negative FX impact.

• 2H FY26 EBITDA expected to exceed the prior year, driven by stronger revenues, higher margins, and cost reductions.

• Revenue expected to build quarter-on-quarter in the second half, with a strong Q4 exit rate and positive momentum into FY27.

• FY27 pipeline visibility is strong, with new customer onboarding and recurring revenue growth anticipated.

• Upside potential includes new Energy Services customers, additional friction reducer sales, and new infrastructure projects.