• Continued improvement in free cash flow to $6.2m, or $16.7m normalised
• Revenue climbed 3.3% to $99.1m, with ANZ up 6.7% offsetting North America decline
• Annualised Recurring Revenue increased 6.9% to $178.1m

EROAD Limited (NZX/ASX: ERD) released its financial results for the 6 months ended 30 September 2025. Key highlights include continued improvement in free cash flow to $6.2m, or $16.7m normalised, revenue growth of 3.3% to $99.1m driven by a 6.7% increase in ANZ, and Annualised Recurring Revenue increasing 6.9% to $178.1m. The company secured an Australian enterprise customer win with Cleanaway (ASX: CWY) and maintained high asset retention at 92%. However, EBIT declined to negative $133.9m due to a non-cash impairment of $134.7m to North American assets, and NPAT decreased to negative $144.2m. The company remains focused on financial discipline, cash generation, and directing investment to the strongest growth markets of Australia and New Zealand, where it is uniquely positioned to capture opportunities around the transition to electronic road user charging (eRUC).

FY26 Revenue guidance of $197m to $203m, FY26 ARR guidance of $175m to $183m, and FY26 free cash flow (to the firm) margin of 5% - 8%, normalised for the 4G hardware upgrade program.

EROAD is focused on its disciplined approach to free cash flow generation, which will guide its growth investment decisions. The company is directing new investment to Australia and New Zealand, where it sees the strongest opportunities, including around the transition to electronic road user charging (eRUC) in these markets. In North America, EROAD is taking a more prudent approach due to slower economic conditions.