Southern Cross Electrical Engineering (SXE) H1 2026 earnings summary

Executive summary

• Underlying EBITDA rose 30.8% to $35.4m and underlying EBIT increased 25.5% to $29.1m, both record half-year results, despite a net loss after tax due to the $46.1m WestConnex arbitration settlement.

• Revenue declined 12.2% year-over-year to $349.1m, mainly due to completion of major projects, but gross profit hit a record $65.9m, with gross margin improving to 18.9%.

• Force Fire acquisition contributed positively, being consolidated for the full period and driving commercial sector growth.

• Order book increased 6% year-over-year to $710m, with over 85% on the East Coast and $200m in non-electrical disciplines.

• Declared a fully franked interim dividend of 2.5 cents per share.

Financial highlights

• Gross margin reached 18.9%, up from 12.7% year-over-year, driven by strong project outcomes and favorable business mix.

• Overheads increased 29.4% due to Force Fire consolidation.

• NPAT loss of $12.8m, mainly from $46.1m in legal dispute costs for WestConnex.

• Cash balance at period end was $58.8m after significant payouts; group remains debt free.

• Underlying EBITDA margin was 10.1%, up from 6.8% year-over-year.

Outlook and guidance

• Raised FY26 underlying EBITDA guidance to at least $72m, a 31% increase over FY25.

• Expecting further growth beyond FY26, supported by a strong pipeline in data centers, infrastructure, and renewables.

• Data center market expected to see significant order inflows from 2026, with projects increasing in size and complexity.