COSOL rebuilds earnings momentum with $6.3m H2FY26 EBITDA turnaround
In its FY26 results presentation released on 19 August 2026, COSOL Limited detailed a return to stronger profitability in the second half of the year, framing the result around a demonstrable H2 recovery rather than the softer full-year picture.
The company reported FY26 revenue of $98.6m and underlying EBITDA of $9.8m, with $6.3m of that EBITDA generated in H2FY26 compared with just $3.5m in H1FY26. Management centred the narrative on a roughly 570 bps improvement in H2 EBITDA margin, supported by a leadership transition and recent contract wins positioned as momentum into FY27.
Full-year figures were down year-on-year, with revenue falling 15.6% and underlying EBITDA declining 41.8%. The presentation was candid on this point, positioning the H2 rebound as evidence that a cost base reset is delivering results.
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A second-half rebound defines the FY26 result
The FY26 outcome was shaped by a clear contrast between a weak first half and a recovering second half. Management attributed the H2 improvement to a reset of the cost base and a recovery in data and digital consulting margins.
H2FY26 delivered an EBITDA margin of 12.8%, a 570 bps improvement on H1FY26. Data and digital consulting gross margin recovered to 37.9% in H2FY26, a 340 bps lift on the prior half. Cash conversion for the full year reached 107.7%, up from 85.1% in FY25.
| Metric | FY26 | FY25 | Change | Note |
|---|---|---|---|---|
| Revenue | $98.6m | $116.8m | -15.6% | Lower AMS and Australian consulting |
| Underlying EBITDA | $9.8m | $16.8m | -41.8% | $6.3m earned in H2FY26 |
| Gross Margin | 30.0% | 31.8% | -1.8pts | H2 recovery narrowed decline |
| Underlying NPATA | $5.2m | $9.9m | -47.3% | Excludes significant items |
| Cash Conversion | 107.7% | 85.1% | +22.6pts | Trade debtor focus |
On a statutory basis, COSOL recorded a net loss after tax of -$4.0m, driven by significant items including $6.5m in goodwill impairment ($4.0m attributed to Asset Management Services and $2.5m to Australian Data and Digital Consulting). Management noted the impairment is a non-cash item with no impact on the company’s cash position.
Leadership transition brings stability
The presentation outlined a managed executive transition designed to preserve continuity. Scott McGowan steps down as Managing Director and CEO after 10 years, moving to a new role as director of strategy and solutions.
Anthony Stokes, previously CFO and COO with 4 years at COSOL, has been appointed interim CEO. The Chairman assumes Executive roles to see through the transition, while Nicola Williamson, General Manager Finance, has been appointed interim CFO.
The appointments are internal, a structure management framed as retaining institutional knowledge during the change.
What COSOL does — turning asset data into performance
COSOL provides asset management and data and digital consulting services to owners of critical, capital-intensive assets across sectors such as transport, resources, energy and water. Its work centres on helping these owners extract performance from complex operational data.
Under new segment reporting, the business now reports across two core segments: Asset Management Services (AMS) and Data and Digital Consulting, the latter split geographically between Australia and the Americas. The company deploys proprietary IP platforms, including the OnPlan works management platform and RP Connect, alongside third-party licensed solutions.
For investors, the mix matters. Recurring annuity-style managed services revenue and higher-margin proprietary IP support earnings quality, a factor relevant to the FY27 margin recovery plan.
FY26 revenue by type was reported as:
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Product & product-led services: $17.3m (40.1% gross margin)
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Managed services: $21.7m (40.8% gross margin)
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Data & digital advisory & consulting: $28.9m (30.5% gross margin)
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Asset Management Services: $30.7m (16.2% gross margin)
Contract wins and the Americas pivot build a platform for FY27
Management positioned recent wins as the forward growth driver. COSOL secured two major mass transportation project wins in Australia and Canada, both utilising its proprietary IP platforms in data and digital consulting.
In the Americas, the company was appointed preferred tenderer for a large transport authority greenfield IBM Maximo implementation, described as its second large-scale implementation win in the last 12 months. IBM-related revenue grew to 25% of FY26 performance, up from zero in FY23, and is anticipated to reach circa 45% of FY27 revenue on the back of these wins.
The company also detailed a rebuild of its Australian sales engine. A new sales leader joined in May 2026, with 6 new hires commencing over recent months and final roles due to begin within six weeks. Management anticipates this will impact revenue from H2FY27.
Balance sheet strength underpins the turnaround
The presentation emphasised disciplined capital management and deleveraging. Net debt reduced by $6.7m to $20.0m from June 2025, and improved a further $0.7m from December 2025.
COSOL reported $11.0m of available headroom in its Westpac facility, described as sufficient to cover the $2.0m Toustone deferred consideration due in February 2027. The company ended the period with a cash position of $5.3m, while its gearing ratio improved to 36.2% from 43.0%.
The Toustone deferred consideration was renegotiated from $6.5m to a fixed $2.0m, producing a $4.5m gain on deferred consideration offset by a corresponding $4.5m goodwill impairment. Management noted this had no net impact on profit or cash.
The FY27 roadmap — restoring margins to historical levels
Management set out a forward plan built around five priorities:
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Expand transport sector revenue on the back of recent contract wins.
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Drive higher-margin revenue growth through the expanded Australian sales team.
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Grow AI revenue by leveraging COSOL’s data expertise and industry domain knowledge.
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Rebuild Asset Management Services for profitable growth.
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Build on Americas momentum in IBM Maximo with further new contracts, while driving shareholder returns.
Management described the FY27 focus as growing revenue through focussed sales leveraging proprietary IP and domain expertise in critical assets, while returning both gross margin and EBITDA margin to historical levels through efficient delivery models and efficient overhead base.
What it means for investors
The FY26 result presents a subdued full year offset by a demonstrable second-half recovery. Revenue and earnings fell year-on-year, but the $6.3m of underlying EBITDA delivered in H2FY26 offers evidence that the cost base reset and margin restoration are taking hold.
A stabilised cost base, a strengthening Americas and IBM Maximo pipeline, and a rebuilt Australian sales engine form the platform management is relying on for FY27 improvement. Disclosed targets include IBM-related revenue reaching circa 45% of FY27 revenue and the sales team rebuild impacting revenue from H2FY27.
For investors weighing the outlook, the H2FY26 rebound sits at the centre of the case, while the pace of the FY27 recovery will depend on delivery against the stated priorities.
For further information, investors can contact COSOL’s investor relations team at ir@cosol.global.
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