BSA Faces Restructuring Risks After Losing Key NBN and Smart Metering Contracts
BSA Limited reported a 7% increase in FY25 revenue to $286.8 million and a 42% rise in EBITDA pre-significant items, despite losing key contracts that accounted for 92% of its revenue. The company is undertaking significant restructuring to navigate these challenges.
- FY25 revenue up 7% to $286.8 million
- EBITDA pre-significant items increased 42% to $30.9 million
- Loss of NBN Co Field Module and smart metering contracts impacting 92% of revenue
- $8.3 million incurred in restructuring costs with further cash outflows expected
- Net cash position of $23.9 million and $10 million undrawn banking facilities
Strong Annual Results Despite Contract Setbacks
BSA Limited has delivered a solid financial performance for the full year ended June 30, 2025, with revenue rising 7% to $286.8 million and EBITDA before significant items surging 42% to $30.9 million. This growth was primarily driven by improved volumes and a favourable work mix in fixed line platforms, reflecting operational efficiencies and effective cost management.
However, the company’s quarterly results reveal a more complex picture. In the final quarter, revenue declined 13% year-on-year to $64.5 million, while EBITDA after significant items dropped sharply due to restructuring expenses. These challenges stem from the loss of major contracts that have historically underpinned BSA’s business.
Impact of Contract Losses and Restructuring
BSA was formally notified in March 2025 that it was unsuccessful in securing the new NBN Co Field Module contract. Work orders under the existing Unified Field Operations contract ceased mid-July, with the contract set to expire at the end of September 2025. Additionally, smart metering contracts with Intellihub and Bluecurrent have seen significant volume reductions, with no material work expected in FY2026.
These contracts collectively represented approximately 92% of BSA’s revenue, making their loss a significant blow. In response, BSA has initiated a company-wide restructuring program, incurring $8.3 million in costs to date, including $6.5 million related to redundancies. A further $7.3 million in redundancy-related cash outflows is anticipated. The company also recorded a $1.7 million write-off of Right-Of-Use assets.
Financial Position and Outlook
Despite these headwinds, BSA ended the quarter with a net cash position of $23.9 million and maintained $10 million in undrawn banking facilities, providing a buffer as it navigates the transition. Operating cash flow for FY25 was a healthy $30.1 million, underscoring the company’s ability to generate cash even amid restructuring.
CEO Sasho Kacevski emphasized that while FY25 results were strong, the company faces ongoing challenges due to contract losses. The executive team is focused on rightsizing the business and maximizing profitability from residual operations. BSA is actively assessing its strategic options and will keep the market informed of material developments.
The coming months will be critical as BSA manages contract demobilisation and restructures its operations to align with a reduced customer portfolio. Investors will be watching closely for signs of new contract wins or diversification efforts that could stabilize revenue streams.
Bottom Line?
BSA’s FY25 financial strength provides a foundation, but the loss of core contracts and costly restructuring signal a challenging road ahead.
Questions in the middle?
- What new contracts or markets can BSA target to replace lost revenue streams?
- How will ongoing restructuring costs impact cash flow and profitability in FY26?
- What is the timeline and expected cost for completing the demobilisation of the NBN Co contract?
