Intelligent Monitoring Group Details 27% Pipeline Jump and Eyes AI Security Expansion

Intelligent Monitoring Group posts strong Q3 with 27% pipeline growth and FY26 guidance reaffirmed

In its April 2026 company update, Intelligent Monitoring Group outlined operating cashflow of $7.7 million for Q3 FY26, representing 14.5% growth on the prior comparable period. The company’s secured pipeline reached $63.2 million, up 27% quarter-on-quarter, while management reaffirmed full-year guidance for underlying EBITDA of $43-47 million and proforma EBITDA of $53-57 million including the Tyco NZ contribution.

Video Guarding, IMG’s AI-enabled monitoring service, recorded 16% customer growth in Q3 on Q2, demonstrating expanding adoption of the company’s higher-value technology-led offerings. The presentation highlighted consistent execution on the group’s growth strategy, with a recurring revenue model providing earnings visibility across both organic and acquisition-driven expansion.

What is recurring revenue monitoring and why does it matter for security companies?

Security and fire monitoring businesses generate revenue through a two-stage model: one-off installations convert into long-term monitoring contracts that produce predictable recurring income. IMG’s revenue breakdown shows 45% from monitoring and 18% from services and maintenance, totalling 63% in highly recurring categories that reduce customer acquisition costs over time.

Customer lifetime value demonstrates the durability of these relationships. Residential and SMB customers average 7 years, while commercial and enterprise clients average 15 years, creating compound value from each new installation. This structure provides earnings visibility and reduces sensitivity to installation volumes, as the monitoring base grows cumulatively.

The revenue structure shows how one-off installation work transitions into recurring monitoring income, with services and upgrades providing additional touchpoints that extend customer relationships and increase lifetime value.

Pipeline acceleration signals commercial momentum

The secured pipeline has grown from $36.6 million in Q1 FY26 to $49.8 million in Q2 (up 36%) to $63.2 million in Q3 (up 27%). This trajectory is particularly significant given the pipeline started at $0 at the August 2023 ADT takeover, demonstrating post-acquisition commercial execution as IMG integrated ADT’s customer base with its own sales infrastructure.

Sector diversification across the pipeline reduces concentration risk:

• Finance: 23%
• Mining/Resources: 22%
• Airport/Transport: 25%
• Construction/Manufacturing: 15%
• Data centre: 10%
• Education/Health: 5%

The distribution indicates IMG’s commercial capability spans multiple sectors rather than relying on a single vertical. Continued pipeline growth suggests the sales organisation is scaling effectively across both Australia and New Zealand, converting technical capability into contracted work.

Video Guarding emerges as growth driver

Video Guarding customer count grew 16% in Q3 on Q2, with operational proof points including over 50 confirmed arrests and more than 15 deterrence events on average each month. The service represents a technology-led differentiation from passive alarm monitoring, using AI video analysis to enable proactive threat response rather than reactive alarm verification.

This positions Video Guarding as a higher-value offering that commands premium pricing relative to traditional alarm monitoring. As adoption scales across the commercial customer base, the service supports margin expansion while demonstrating IMG’s ability to deploy AI-enabled capabilities that competitors may lack.

FY26 guidance confirmed with Tyco NZ integration on track

Management reaffirmed FY26 guidance for underlying EBITDA of $43-47 million and proforma EBITDA of $53-57 million, with the $10 million Tyco NZ contribution dependent on settlement timing for reported results. Proforma adjusted EPS is positioned at 6.2-7.0 cents per share, based on the expected result following a full year of the Tyco NZ acquisition.

FY26 Guidance

Underlying EBITDA: $43-47 million

Proforma EBITDA: $53-57 million (including Tyco NZ)

Proforma adjusted EPS: 6.2-7.0 cents per share

Q3 capex totalled $1.8 million, down 19.7% on the prior comparable period, with the final quarter of 3G upgrade capex in New Zealand ($0.8 million) now complete. This removes a near-term cash drag as the legacy network transition concludes, improving operational cash conversion going forward.

Valuation context

Based on a current share price of $0.50 and proforma EBITDA of $53 million, IMG trades at a proforma EV/EBITDA multiple of 5.5x. Net debt to EBITDA sits at 1.5x proforma, described as the low end of industry norms and indicating conservative leverage relative to the asset base and cash generation profile.

The company completed refinancing to NAB senior debt in FY25, indicating improved credit standing following the operational transformation since 2021. At sub-8x PE on proforma earnings and low gearing, the valuation appears modest if execution continues at the current trajectory, particularly given the recurring revenue composition provides earnings predictability.

Strategic roadmap positions IMG for continued growth

The presentation outlined a corporate evolution across distinct phases:

1. Fix up the base (2021-2022): Threat Protect transitioned to Intelligent Monitoring Group and invested in a new operating platform
2. Add technical services capability (2023-2025): Acquired ADT (Australia & New Zealand), then bolt-ons including ACG, DVL, AAG, Kobe, BNP, and Red Wolf (NZ) to drive coverage and depth
3. Add technical capability in fire space (2026): Acquired Tyco NZ (trading as Wormald)
4. Drive AI video-based services (2026+): Expand into higher-value commercial applications across Australia and New Zealand

The bolt-on acquisition track record demonstrates disciplined M&A capability, with each transaction adding either geographic coverage or technical expertise that layers onto the monitoring platform. IMG presented underlying organic growth of 8.3% in 1H26 compared to 8.2% in FY25, indicating the base business is expanding independent of acquisitions.

This combination of organic growth and disciplined M&A creates a compounding platform where each new customer, whether acquired or won organically, converts into long-term recurring revenue that funds further expansion. The forward focus on AI video services positions IMG to capture higher-value commercial work as enterprise clients seek technology-enabled security solutions that go beyond traditional passive monitoring.

Want to See How Recurring Revenue Growth Could Transform a Security Business?

Intelligent Monitoring Group’s Q3 results demonstrate the compound value of a recurring revenue model that converts one-off installations into 7-to-15-year customer relationships. The company’s secured pipeline has grown from zero at the ADT takeover to $63.2 million in Q3 FY26, with Video Guarding customer adoption accelerating 16% quarter-on-quarter.

To explore how IMG’s AI-enabled monitoring services and bolt-on acquisition strategy are building a platform for sustained growth, visit the Intelligent Monitoring Group investor centre. The company’s FY26 guidance of $43-47 million underlying EBITDA reflects consistent execution on a strategy that combines organic growth with disciplined capital deployment.