Southern Cross Electrical Engineering (SXE) Trading update summary

Transaction overview

• Agreement to acquire 100% of Entire Operations for up to $112.1m cash-free, debt-free: $70m upfront, up to $25.8m in base earn-outs and up to $16.3m in outperformance earn-outs.

• Valuation equates to 5.5x FY26A EV/EBIT assuming maximum base earn-outs and 4.1x FY29F EV/EBIT assuming maximum outperformance earn-outs and FY29F EBIT of at least $27.5m.

• Existing executive employee shareholders will remain under long-term employment contracts extending beyond the earn-out period.

Entire profile

• Melbourne-headquartered integrated fire protection and HVAC provider, with engineering, design, fabrication, construction, commissioning and maintenance capabilities.

• FY26 revenue of $191m and EBIT of $17.5m; more than 490 staff, around 120 active clients and an $800m+ project pipeline.

• FY26 revenue mix: commercial and mixed use 30%, data centres 25%, infrastructure 20%, health and aged care 15%, other 10%; 90% generated in Victoria and 10% in Queensland.

• Recurring minor works and maintenance represented ~35% of revenue; customers include Tier 1 contractors and asset owners, with no reliance on a single client.

Strategic rationale

• Adds mechanical services to existing electrical, fire, security and communications capabilities, expands the Victorian footprint and supports a national fire services platform.

• Broadens exposure to data centres, infrastructure, health care, commercial and government markets; compliance needs support fire demand while efficiency upgrades and electrification support HVAC demand.

• Opportunities include cross-selling, larger multidisciplinary projects, growing recurring services and using Entire's fabrication capabilities across the combined operations.