Veem (VEE) H1 2025 earnings summary

Executive summary

• Revenue for H1 FY25 was AUD 33.6 million, down 10% year-over-year, with EBITDA at AUD 3.9 million and NPAT at AUD 1 million, both at the upper end of guidance but down 43% and 71% year-over-year, respectively.

• Operating cash flow was AUD 1.8 million, down 50% year-over-year, with cash and equivalents at AUD 0.3 million and an overdraft of AUD 1.9 million.

• Interim dividend declared at 0.23 cents per share, maintaining a 30% payout of NPAT.

• Management succession completed with new CEO, CFO, COO, and CIO appointed.

• Activity levels decreased due to lower defence and ASC revenue, with some propulsion orders delayed to H2 FY25.

Financial highlights

• Revenue was AUD 33.6 million, down 10% year-over-year but up 23% on FY 2023, meeting guidance.

• EBITDA was AUD 3.9 million (down 43%), NPAT AUD 1 million (down 71%), and EPS 0.75 cents (down 71%).

• Operating cash flow was robust at AUD 1.8 million, with a net overdraft position at period end.

• Interim dividend of 0.23 cents per share declared, maintaining historical payout ratio.

• Adjusted EBITDA (ex-AASB 16 leases) was AUD 2.9 million.

Outlook and guidance

• Second half expected to be significantly stronger, with delayed orders and increased work in progress set to convert to revenue.

• Propeller and gyro sales anticipated to rebound, with strong order book, new contracts, and expanded marketing.

• Defence revenue to increase in H2 FY25 with new orders and completion of key programs.

• Cost reductions and margin improvements are expected to support profitability in the second half.

• Sharrow by VEEM targeting 75 vessel installations in the next 12 months.