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Revenue: Record revenue increased 21% to $520 million, with growth broad-based across all regions.
EBITDA (Normalized): Increased 29% to $163 million, with margin expanding to just over 31%.
NPAT (Normalized): Record NPAT normalized of $59 million, reflecting earnings growth outpacing revenue growth.
NPATA (Normalized): Increased to $70 million.
EPS (Normalized): Increased 37% to $0.115 per share.
Operating Cash Flow: Strong at $126 million, or $135 million on a normalized basis, with cash conversion of 83%.
Net Debt: Increased to $199 million following five acquisitions, with leverage at 1.3 times.
Dividend: Final fully franked dividend of $0.0175 per share, taking the full-year dividend to $0.034 per share, an increase of 36%.
R&D Investment: Invested $43 million in R&D during FY26.
Capital Expenditure: Increased to $69 million, reflecting investment in next-generation technologies.
Integrated On-Site Services Revenue: Increased 20% year-on-year.
DEK Segment Revenue: Increased 85% in FY26, with a 32% five-year CAGR.
Share of Wallet: Increased to a record $2.40 per $100 of global exploration spend, up from $2.20 in FY25.
Acquisitions Contribution: Acquisitions contributed $17 million in revenue, representing approximately $51 million of annualized revenue on a full-year equivalent basis.
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For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Record revenue of $520 million, up 21%, with broad-based growth across all regions and market share gains accounting for over half of the growth.
Record normalized EBITDA of $163 million, up 29%, with margin expansion to 31%, demonstrating strong operating leverage.
Strong cash generation with 83% cash conversion, enabling continued investment and a 36% increase in the full-year dividend.
Digital Earth Knowledge (DEK) segment delivered an 85% revenue increase, with platform revenue now 47% of group revenue, up from 33% five years ago.
FY27 started strongly with July setting a record revenue month, and the company expects continued growth above market, supported by a full year contribution from five acquisitions.
Net debt increased to $199 million following five acquisitions, with leverage at 1.3 times, though within target range.
Integration and transaction costs of $15 million in FY26 are expected to continue into FY27, impacting near-term earnings.
Rising operating costs and inflation, including impacts from geopolitical events, are expected to persist and pressure margins in FY27.
Exploration spending growth is expected to be tempered by challenges such as permitting and supply chain issues, potentially delaying activity.
Higher depreciation, amortization, and financing costs are anticipated in FY27, which may offset some margin expansion.
Q: How has FY27 year-to-date organic revenue growth started, and can you unpack the July versus June performance to distinguish genuine organic improvement from acquisition tailwinds?A: Paul House (CEO): July was a record revenue month for Imdex, surpassing June, which itself was a record. We are comparing apples with apples as all acquisitions were completed in earlier months, so the uplift is pound-to-pound comparable. Historically, in a growth phase of 4% to 5%, we would expect Q1 to be slightly above Q4, and we are seeing that trend continue.
Q: Can you provide more color on the FY27 outlook, specifically regarding the market's exploration growth expectations and whether the language has softened from the 15% to 20% growth mentioned previously?A: Paul House (CEO): We have always been clear that the market wants to spend 15%, but in the last year, they only spent 8% or 9%. The intention to spend is there, but the ability to spend is hampered by geopolitics, supply chains, and permitting. We are making a distinction between customer commitment and their ability to get it done. We don't think it changes the intention, but what lands in the ground in that 12-month window will likely be a little less.
Q: What should we expect in terms of integration costs in FY27, and can you break down the $15 million in costs seen in the second half?A: Linda Lim (CFO): In FY27, you will expect to see integration costs continue as we integrate the 5 acquisitions. The $15 million breakdown includes roughly $3 million of transaction costs, $3 million of purchase price allocation adjustments, and the remainder is integration costs. This is a partial year figure, so you can extrapolate that forward for a full year of integration in FY27.
Q: Given the 20% increase in integrated site revenues and 42% increase in sites, what is the latent capacity to add further services into those added sites?A: Paul House (CEO) and Shaun Southwell (Chief of Exploration and Production): Once on site, we have a front-row seat to grow revenue on established sites. For example, customers adopting directional drilling might use it 2-3 times in the first year, then 5-6 times in the second, and eventually throughout their entire program. We are also expanding integration into smaller projects, with customers pulling us into even two-rig projects, setting this as an industry standard.
Q: How should we think about the timeline for the full integration of the newly acquired businesses and when the Imdex platform can fully leverage tools for individual customers?A: Paul House (CEO) and Michelle Carey (Chief of Strategy): Pulling together the digital technologies is a two-year journey from when we completed those acquisitions, starting in February. However, we don't think of this as a big bang event. We are incrementally releasing product offerings, such as televiewer work that goes from data collection into automated interpretation, ahead of the full platform build-out timeline.
Q: Can you provide guidance on depreciation, amortization, and net interest for FY27, and are there offsetting factors to consider for margin expansion?A: Linda Lim (CFO): We provided guidance on D&A and financing costs to address consensus differences. It aligns with our capital profile spent in the prior year. Financing costs assume a potential small rate rise in September and higher borrowings. The new businesses will be margin neutral, but DST and DEK are achieving 34% to 35% margins. FY27 will be a year of investment, setting us up for margin accretion into the future.
Q: How is Imdex positioned in South America, which is expected to become the largest exploration region within 12-24 months, and what is the market share versus North America?A: Paul House (CEO), Shaun Southwell (Chief of Exploration and Production), and Michelle Carey (Chief of Strategy): North America is largely serviced by many technologies, so we compete for market share. In South America, there are un-serviced areas, so we are educating the market to create market size. South America is the most lagging in technology adoption, similar to where North America was 4-5 years ago, and we are well-positioned to capture that shift. The DEK business has been more focused on Australia, so there is significant growth potential across other regions.
Q: Can you provide color on customer conversations regarding exploration budgets and the outlook for the rest of the calendar year across major regions?A: Paul House (CEO): The urgency around replacing reserves, changing government policies, and rising costs necessitating better technology use is more universal this year. The policy environment in Australia is slightly less supportive compared to South America, and there is a strong role of government in North America. The major customers are all having the same conversation about spending more efficiently. The only caution is that the ability to spend might push further out to the right, but the underlying intention is positive.
Q: What is the normalized effective tax rate for FY27, and are there any moving parts to consider?A: Linda Lim (CFO): The normalized effective tax rate is 32%, and we expect that to continue into FY27.
Q: Can you remind us of the FX sensitivities for the full year in light of the acquisitions?A: Linda Lim (CFO): Our FX exposure is unchanged, with 50% of revenues in US dollars. A 1% movement in the US dollar FX rate is around $2.5 million to $3 million impact, with about 50% of that flowing through to the EBITDA line.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.