The Service Stream Ltd (ASX: SSM) share price is in focus after the company reported an 18.4% jump in NPAT-A to $81.1 million, and 11.8% higher operational EBITDA for FY26.
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What did Service Stream report?
- Group revenue of $2.48 billion
- EBITDA from operations of $163.4 million, up 11.8% on last year
- NPAT-A of $81.1 million, up 18.4% from FY25
- EBITDA-A margin improved to 6.6%
- Net cash balance increased to $80.7 million
- Final fully franked dividend of 3.5 cents, taking FY26 dividend to 6.5 cents (up 18.2%)
What else do investors need to know?
Service Stream successfully mobilised several new contracts in Defence, Water, and Industrial sectors, helping boost its contracted work-in-hand to $8.2 billion (excluding extension options). Cash generation remained strong, with a 24.9% increase in operating cash flow and an EBITDA-to-cash conversion rate above 113%.
Availability of skilled staff supported new contract launches and ongoing growth, while inflationary pressures were managed effectively via operational improvements and contract terms.
What did Service Stream management say?
Managing Director Leigh Mackender said:
Financial year 2026 was another period of strong and positive performance with Service Stream delivering improved financial results, headlined by enhanced group margins, double-digit growth in EBITDA-A and NPAT-A, generation of exceptional cashflows and a strengthening of the Group's net cash balance sheet. The business expanded its total addressable markets, successfully securing and mobilising several new contractual agreements across the defence, water and industrial sectors as it continues to diligently execute its value creation strategy.
What's next for Service Stream?
Management expects earnings growth in FY27 on the back of improved quality of earnings, benefits from mobilising new contracts, and strong demand for infrastructure upgrades. The group says its scalable platform positions it well to capture further opportunities as clients invest in essential networks.
The board remains confident the company can take advantage of increased infrastructure spending and sees a robust pipeline of projects in critical sectors.
Service Stream share price snapshot
Over the past 12 months, Service Stream shares have risen 25%, outperforming the All Ordinaries Index (ASX: XAO), which has risen 1% over the same period.
