Tasmea’s Record Growth Raises Questions on Acquisition Integration and Future Risks

Robust Financial Performance

Tasmea Limited has delivered a standout performance in FY25, posting record financial results that underscore the strength of its diversified specialist trade services model. The company’s pro-forma revenue surged 52.4% to $620.8 million, while pro-forma earnings before interest and tax (EBIT) climbed 70.1% to $93.2 million. Net profit after tax (NPAT) on a pro-forma basis rose 69.4% to $62.5 million, reflecting both organic growth and the full-year impact of acquisitions.

Statutory results also showed impressive gains, with revenue up 37% to $547.9 million, EBIT increasing 60.3% to $74.4 million, and NPAT soaring 74.1% to $53.1 million. Earnings per share jumped 52.6% to 23.2 cents, highlighting strong shareholder returns.

Dividend Growth and Cash Flow Strength

Supporting its robust earnings, Tasmea declared a fully franked final dividend of 6.0 cents per share, a 50% increase from the prior year. Including a special dividend of 12 cents per share, total dividends for FY25 reached 23.0 cents per share, representing a substantial uplift from FY24. The company’s strong cash flow generation was evident, with an 88% conversion of EBIT to operating cash flow, underpinning the dividend payments and maintaining balance sheet strength.

Strategic Acquisitions and Operational Highlights

FY25 was marked by four targeted acquisitions, West Coast Lining Systems, Future Engineering Group, Flanco Group, and Vertex Group, that collectively added approximately $180 million in annualised revenue and $31.3 million in maintainable EBIT. These acquisitions expanded Tasmea’s capabilities across geomembrane services, power infrastructure, civil and concrete works, and high-voltage portable power, enhancing its competitive positioning.

Operationally, the Electrical division stood out with a 66% revenue increase and a 135% jump in EBIT, now accounting for 44% of group EBIT. Civil works nearly doubled revenue to $103 million, buoyed by contributions from the NWMC project and the Flanco acquisition. Water & Fluid services grew 17%, while Mechanical remained steady despite challenges in nickel-exposed operations.

Outlook and Growth Drivers

Entering FY26, Tasmea boasts a record $600 million in secured and recurring revenue, up 29% year-on-year, providing strong earnings visibility. The company reaffirmed its FY26 guidance with an EBIT target of $110 million and NPAT of $70 million, representing a 32% increase on FY25. This outlook is supported by a growing pipeline of Master Service and Facilities Management Agreements, which have expanded from 41 at IPO to over 70 today.

Tasmea’s strategic focus on electrification, infrastructure renewal, and maintenance of ageing fixed plant positions it well to capitalise on structural industry tailwinds. The company’s disciplined capital management approach aims for a dividend payout ratio of 30–50% of NPAT while preserving flexibility for further organic growth and acquisitions.

Safety and Culture as Competitive Advantages

Safety remains a cornerstone of Tasmea’s operational philosophy, with the group extending its record to over 4,565 days without a lost-time injury. This commitment not only safeguards employees but also strengthens customer trust and contract retention, underpinning long-term relationships in competitive markets.