Emeco (EHL) H2 2025 earnings summary

Executive summary

• Achieved strong earnings and margin growth in FY 2025, with all key financial metrics improving year-over-year, including robust cash generation and a resilient business model.

• Revenue increased 7% to $785 million, driven by higher demand for fully maintained rental and expanded workshop services, excluding discontinued underground contract mining.

• Operating NPAT rose 22% to $84 million, and Operating EBITDA grew 7% to $301 million.

• Major contract extensions secured, providing ongoing revenue certainty and supporting long-term customer relationships.

• Focused on cost efficiency, contract management, and prudent capital management, resulting in robust free cash flow and significant deleveraging.

Financial highlights

• Revenue up 7% year-over-year to $785 million; rental revenue up 9% to $615 million.

• Operating EBITDA up 7% to $301 million; operating EBIT up 16% to $146 million; operating EBIT margin rose from 15% to 19%.

• Operating NPAT increased 22% to $84 million.

• EBITDA margin improved from 34% to 38%.

• Operating free cash flow up 32% to $114 million; cash conversion at 97%.

Outlook and guidance

• FY 2026 guidance includes moderate earnings growth, significant free cash flow, and further deleveraging.

• SIB CapEx expected at $170–$175 million ($155–$160 million net of disposals); no growth CapEx planned.

• Depreciation forecasted at $160–$165 million; ERP spend around $6 million.

• Focus on increasing utilisation, especially in fully maintained rental projects, and completing ERP/digitization initiatives.

• Set carbon emissions reduction targets and expand Force service offering for battery-powered fleet.