Gentrack Eyes 15% Revenue Growth as Recurring Income Hits 77% of Total
Gentrack delivers recurring revenue growth and two acquisitions in HY26
In its HY26 half-year results presentation delivered on 18 May 2026, Gentrack Group (ASX: GTK) Chief Executive Officer Gary Miles and Chief Financial Officer John Priggen outlined a period defined by accelerating recurring revenue and two strategic acquisitions. Group recurring revenue grew 11.6% to NZ$85.3m, while total revenue of NZ$110.1m reflected a planned reduction in non-recurring project work. The acquisitions of Factor (utilities pricing and forecasting) and DTP (airport technology) were presented as the primary growth catalysts for the periods ahead.
Key financial headlines from the presentation:
- Total revenue: NZ$110.1m (HY25: NZ$112.0m, -1.7%)
- Group recurring revenue: NZ$85.3m (+11.6%)
- EBITDA (excl. acquisition costs): NZ$7.9m (HY25: NZ$13.0m, -39.2%)
- NPAT: NZ$5.1m (HY25: NZ$7.2m, -28.9%)
- Net cash: NZ$73.2m, no external debt
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Understanding the numbers — what drove HY26 performance
Recurring revenue is the engine
The 11.6% growth in recurring revenue to NZ$85.3m is the metric management identified as its strategic priority, forming the foundation of the company’s medium-term target of more than 15% compound annual revenue growth.
Within the Utilities segment, recurring revenue rose 9% to NZ$73.3m (HY25: NZ$67.4m). The growth was led by Support Services, which increased 20% to NZ$22.5m, alongside Annual Fees, which rose 8% to NZ$35.1m. Veovo, the company’s airport technology division, delivered an even stronger result, with recurring revenue surging 33% to NZ$12.0m (HY25: NZ$9.0m), underpinned by a 21% increase in Annual Fees.
CEO Gary Miles
“Gentrack is well positioned to lead across both airports and utilities sectors as they modernise operations and adopt AI… We are confident in our target of >15% CAGR in the medium term.”
The NRR drag — temporary, not structural
The headline revenue and EBITDA decline was driven entirely by a fall in non-recurring revenue (NRR), which dropped 30% to NZ$24.9m (HY25: NZ$35.6m). This is revenue generated from one-off project delivery engagements rather than ongoing subscriptions or contracts.
In the Utilities segment specifically, NRR fell 33% to NZ$17.0m following the completion of several named projects, including Utility Warehouse, Vocus, PWC, and Phase 2 of Neom, combined with a delay in the timing of new contract wins. Management was explicit that this represents a timing issue, not customer attrition.
EBITDA (excl. acquisition costs) fell to NZ$7.9m, equating to a margin of 7.2%, compared to NZ$13.0m and 11.6% in HY25. Operating costs rose 11% as the company continued investing in product development, sales capability, and its g2 platform. NPAT of NZ$5.1m was partially supported by a tax credit of NZ$3.9m (versus a NZ$1.9m charge in HY25), arising from the tax treatment of long-term incentive (LTI) scheme vesting — a non-cash accounting item. Net cash remained strong at NZ$73.2m with no external debt, and management indicated it expects the full year to be cash generative before acquisitions and share buyback activity.
| Metric | HY25 (NZ$m) | HY26 (NZ$m) | Change (NZ$m) | Change (%) |
|---|---|---|---|---|
| Revenue | 112.0 | 110.1 | -1.9 | -1.7% |
| Recurring Revenue | 76.4 | 85.3 | +8.9 | +11.6% |
| EBITDA (excl. acquisition costs) | 13.0 | 7.9 | -5.1 | -39.2% |
| NPAT | 7.2 | 5.1 | -2.1 | -28.9% |
| Net Cash | 70.7 | 73.2 | +2.5 | +3.4% |
Two acquisitions, two growth vectors — Factor and DTP explained
Factor — pricing intelligence embedded into g2
The Factor transaction was presented as a capability acquisition, with its advanced pricing and forecasting technology set to be integrated directly into Gentrack’s g2 platform, making it immediately available to more than 60 global utility customers.
The transaction terms disclosed in the presentation are as follows:
- Enterprise value: NZ$24 million, with a potential earn-out of NZ$10m linked to growing Annual Recurring Revenue (ARR) to approximately NZ$17m within the first 3 years of the transaction
- Funded entirely from Gentrack’s existing cash reserves
- Completed simultaneously with the signing of the Sale and Purchase Agreement on 15 May 2026
Management outlined that the Factor acquisition positions g2 as the clear leader in B2B energy, enabling retailers to create, price and manage innovative products profitably. Factor’s technology requires no market localisation and supports same-day deployment, which the presentation described as an accelerated route to new market entry. The transaction is targeted to be earnings per share (EPS) accretive in FY28, excluding any benefit from improved g2 win rates.
DTP — accelerating Veovo’s AI-powered airport intelligence
DTP was presented as a bolt-on acquisition that deepens Veovo’s machine learning and airport management capabilities, extending across a footprint of 150+ airports in 26 countries.
The transaction terms for the DTP acquisition are as follows:
- Enterprise value: US$10 million (approximately NZ$17 million), subject to customary completion adjustments
- Funded entirely from Gentrack’s existing cash reserves
- Expected completion: within one month of 18 May 2026, subject to customary closing conditions
The presentation indicated DTP is expected to add approximately NZ$3.5m of revenue to Veovo across the remaining approximately 4 months of FY26, and is expected to be marginally EBITDA accretive (before acquisition costs) in FY26.
Three strategic capability additions DTP brings to Veovo’s product suite were highlighted:
- World-class AirportView app, increasing information distribution and accessibility
- Strong integration and messaging backbone, accelerating the ability to connect platforms airport-wide
- Open data framework and wider datasets, driving improved analytics insight
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Outlook — FY26 guidance and the medium-term growth case
FY26 guidance confirmed
FY26 guidance was confirmed by management on 5 May 2026 and was not new guidance issued at this presentation. The confirmed ranges are:
- Revenue: NZ$229m to NZ$238m
- Recurring revenues: grow more than 10% to approximately NZ$174m
- NRR revenues: lower than FY25
- EBITDA: NZ$13.5m to NZ$20.0m (all figures excluding acquisition costs)
The financial impact of the Factor acquisition is already incorporated within this guidance range.
The pipeline and medium-term target
The Utilities pipeline for the next 12 months includes more than 10 new customer opportunities spanning approximately 30 million meter points across Europe and APAC. Management targets 3–4 wins from now through to March 2027, which it indicated would set up strong FY27 revenue growth.
On the medium-term outlook, management reiterated confidence in more than 15% revenue CAGR, with EBITDA margins targeted to expand into the 15%–20% range as recurring revenue scales and operating costs are expected to grow more slowly than revenue in the second half. Veovo was described by CEO Gary Miles as having had “an exceptional first half”, with continued momentum anticipated.
In addition, the presentation noted that Gentrack owns approximately 10% of Amber, following a NZ$12.9m investment in January 2024 and a further NZ$4.9m invested in May 2025. Amber currently operates 53,500+ automated devices and holds more than 65% Australian market share in automation. The stake is held at cost on Gentrack’s balance sheet and was described as a strategic position in the energy transition.
What is recurring revenue and why does it matter for software investors?
Recurring revenue refers to income generated from ongoing subscriptions, annual licence fees, and support contracts — revenue a company can rely on renewing each period. Non-recurring revenue, by contrast, comes from one-off project delivery engagements and is inherently less predictable.
For software business valuations, a high proportion of recurring revenue signals stability, margin expansion potential, and lower customer churn risk. In HY26, recurring revenue represented 77% of Gentrack’s total group revenue, up from 68% in HY25. This structural improvement underpins management’s medium-term EBITDA margin target of 15%–20%.
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