COSOL Delivers Strong Results, Underpinned by Organic Growth

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Stock Cosol Ltd (COS.ASX)
Release Time 19 Feb 2025, 9:01 a.m.
Price Sensitive Yes
 COSOL Delivers Strong Results, Underpinned by Organic Growth
Key Points
  • Revenue up 17.8% to $57.8m with gains across all segments
  • Underlying EBITDA up 17.6% to $8.2m
  • NPATA growth of 14.5% to $4.9m
  • Strong start to H2, budgeting additional material gains in revenue and earnings
Full Summary

COSOL Limited (ASX: COS) has reported another strong operating result for the six months to 31 December 2024, with gains in revenue, profit and underlying earnings per share. Revenue increased by 17.8% to $57.8m, driven by strong contributions across all industry segments, including initial contributions from four new, long-term managed service contracts in the natural resources, energy & water and transport & infrastructure sectors. Underlying EBITDA was up 17.6% at $8.2m, and underlying earnings per share grew by 5.3% to 2.47 cents. Net profit after tax (NPATA) increased by 14.5% to $4.3m after adjustments for non-cash acquisition amortisation charges. Operating margins remained consistent at 14.1%, despite the impact of higher growth in lower-margin professional services, which established a beachhead in net new customers. COSOL continues to invest in proprietary IP software solutions, including the addition of AI capabilities co-developed with clients. The company is well-positioned to win digital transformation projects with its proprietary IP and software, as well as its market-leading data transformation capabilities. COSOL expects a strengthening of its key financial metrics in the full year as new contracts and further revenue synergies kick in.

Guidance

COSOL expects to grow its operating margin as it embeds new clients and managed services contracts, and continues to map digital transformation projects for clients. The company has a strong pipeline of contracted and new opportunities in both Australia and the USA, and continues to invest in client engagement and co-development of leading-edge IP solutions to drive long-term organic revenue growth.

Outlook

The outlook for FY25 H2 and for FY26 is positive, with a strong pipeline of contracted and new opportunities in both Australia and the USA, and continued investment in COSOL's client engagement and co-development of leading-edge IP solutions to drive long-term organic revenue growth.