Iress lifts Cash EBITDA 47% as efficiency drive resets the cost base
In its 1H26 financial results presentation delivered on 17 August 2026, Iress Group CEO Andrew Russell and CFO Cameron Williamson outlined a period defined by disciplined execution and margin expansion, with Continuing business Cash EBITDA reaching $61.1m, up 47.1% on a constant currency basis.
Cash EBITDA margin expanded by more than 740 basis points to 24.5%, a shift management attributed to structural cost discipline. Revenue rose to $250.0m (+2.5%) and the interim dividend lifted 27.3% to 14.0cps, now fully franked.
The presentation framed the result around three themes: a simpler business, disciplined execution and the next phase of strategy underway. All Continuing business figures cover APAC Wealth, Global Trading & Market Data (GTMD) and UK Wealth & Sourcing on a constant currency basis.
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1H26 results headline a higher-quality earnings mix
Management emphasised the resilience of recurring revenue, which grew 3.4% to $237.8m. Non-recurring revenue declined 11.6%, which the presentation attributed to the completion of large client projects.
Headline Underlying EPS reached 20.8cps (+18.4%), while Continuing business Underlying EPS rose 24.5% on the prior corresponding period. The margin story sat at the centre of the update, with efficiency gains flowing through to the bottom line.
| Metric | 1H26 | Change |
|---|---|---|
| Revenue | $250.0m | +2.5% |
| Recurring revenue | $237.8m | +3.4% |
| Cash EBITDA | $61.1m | +47.1% |
| Cash EBITDA margin | 24.5% | +742bps |
| Interim dividend | 14.0cps | +27.3% |
Key message from the presentation
Iress framed the 1H26 result as evidence of progress towards building a higher-quality software business, underpinned by better products, stronger customer relationships and more disciplined commercial execution.
Efficiency program running ahead of plan
The business efficiency program has delivered $31.5m in annualised savings as at 30 June 2026, an increase of $14.5m since the FY25 result reported in February 2026. Management indicated a further $6-9m of annualised efficiencies is expected in 2H26.
The savings bridge from the FY25 result to June 2026 comprised the following components:
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Achieved at FY25 result (Feb 2026): $17.0m
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Organisational restructure: +$8.4m
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Software & IT: +$2.2m
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G&A: +$3.5m
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Property: +$0.4m
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Total to 30 June 2026: $31.5m
Leverage fell to 0.5x, down from 0.8x at 1H25, which management said creates balance-sheet flexibility to fund the product evolution program.
Understanding Cash EBITDA and why the margin story matters
Cash EBITDA is Adjusted EBITDA less capital expenditure (capex), a figure the company uses because it reflects genuine cash generation after the cost of building and maintaining software.
Why does the 742 basis point margin expansion matter to investors? A rising margin signals that profit growth is being driven by structural cost discipline. This tends to support sustainable dividends and reinvestment capacity, both of which featured prominently in the update.
Recurring revenue, primarily subscription fees and royalties, is prized by investors for its predictability. Its growth to $237.8m provides a more stable earnings base than one-off consulting or project income.
Updated FY26 guidance: softer revenue, stronger profitability
Management revised its FY26 guidance to reflect $7-8m in lower non-recurring revenue, trimming expected revenue growth to +1-2%. At the same time, Cash EBITDA guidance was raised to +21-26% on the back of stronger underlying profitability.
The presentation noted the FY26 Cash EBITDA margin exit run-rate of 25% remains on track, alongside a step-up in capex in 2H26 as the product evolution program accelerates to execution.
| Metric | Current guidance | Updated guidance | Reported |
|---|---|---|---|
| FY26 Revenue | $520-528m (+3-5%) | $509-515m (+1-2%) | $499-505m |
| FY26 Cash EBITDA | $116-123m (+15-23%) | $121-126m (+21-26%) | $119-124m |
| FY26 UPAT | $84-90m (+15-24%) | $84-88m (+15-21%) | $82-86m |
The four-stage pathway: Simplify, Strengthen, Evolve, Grow
Management outlined a strategic roadmap structured around four stages, each with an assigned status:
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Simplify (Completed) — Non-core divestments, a strengthened balance sheet and a sharper focus on core markets.
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Strengthen (Ahead of plan) — $31.5m in annualised efficiencies, margin expansion and lower leverage.
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Evolve (In execution) — The Thoughtworks partnership mobilised, an AI-enabled Xplan roadmap and faster product delivery.
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Grow (Next phase) — Higher-quality recurring revenue, increased platform adoption and stronger customer retention.
The presentation detailed that AI is now embedded across the company’s product and engineering strategy, with governance established and AI-enabled capabilities incorporated into the Xplan roadmap. Management positioned this as a stage in execution.
The Iress Thoughtworks partnership, announced in May 2026, adopts a staged modular approach to modernisation, specifically designed to avoid the cost blowouts that have plagued big-bang replatforming programs at comparable software businesses.
What Iress told investors about the road ahead
Management stated its strategic priorities remain unchanged, with the focus in 2H26 on increasing the pace of execution. Key priorities include delivering the further $6-9m of annualised efficiencies, rolling out new Xplan AI-enabled adviser workflow capabilities and a refreshed Client Portal, and strengthening enterprise customer renewals.
The presentation closed on the investment thesis: a simpler, more profitable software business with a growing fully franked dividend at a 67% payout ratio, leverage of 0.5x and the capital flexibility to fund continued product evolution.
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