Comms Group Limited reported a steady 2% revenue increase to $56.6 million in FY25, hitting the top end of guidance despite margin pressures from global expansion investments. The recent TasmaNet acquisition is on track to drive future growth.
- FY25 revenue up 2% to $56.6 million, top-end of guidance
- Underlying EBITDA $5.7 million, impacted by global business staffing costs
- New annual recurring revenue surged 35% to $10.4 million
- TasmaNet acquisition completed June 2025, integration progressing well
- Targets $75 million revenue and $9-10 million EBITDA run-rate post-integration
Steady Growth Amid Strategic Investments
Comms Group Limited (ASX, CCG) has delivered its FY25 full-year results, reporting total revenue of $56.6 million, a modest 2% increase over the prior year and comfortably at the top end of its guidance range. This growth was underpinned by a strong performance in its Global division and a 35% jump in new annual recurring revenue (ARR) to $10.4 million, signalling robust sales momentum across its communications and managed IT services portfolio.
Despite the revenue growth, underlying EBITDA declined 12.7% to $5.7 million, primarily due to increased investment in key global business staff. This strategic spend is positioned to support future expansion, particularly in international markets, and is expected to benefit FY26 earnings.
TasmaNet Acquisition Integration on Track
A significant highlight for Comms Group in FY25 was the acquisition of Tasmanian telecommunications provider TasmaNet, completed in mid-June 2025. TasmaNet brings a strong regional presence with its own fixed wireless and fibre networks covering approximately 85% of Tasmania’s population, along with a diverse customer base including government and corporate clients.
The integration process is progressing according to plan, with key customer and supplier novations largely completed and network rationalisation underway. Early indications suggest that the acquisition will meet financial expectations, with management targeting a run-rate revenue exceeding $75 million and underlying EBITDA between $9 million and $10 million once the transition is fully realised.
Operational Strength and Cash Flow Discipline
Comms Group’s gross margin improved slightly to 47.9%, reflecting disciplined cost management and strong pricing strategies. The company’s asset-light business model continues to generate solid operating cash flow, with $3.6 million reported in FY25 despite one-off acquisition costs. Free cash flow remained healthy at $3.3 million, supporting the company’s priorities of debt reduction, reinvestment in technology, and shareholder returns.
The final dividend declared was 0.125 cents per share fully franked, bringing the total dividend for FY25 to 0.25 cents per share. Management reaffirmed its commitment to balancing growth ambitions with sustainable capital management.
Looking Ahead, Growth and Integration Focus
Comms Group’s strategic outlook remains focused on consolidating the TasmaNet acquisition, expanding its footprint in the corporate mid-market and government sectors, and leveraging its Asia-Pacific presence to serve multinational clients. The company is actively pursuing both organic growth and M&A opportunities to enhance scale and capabilities.
FY26 guidance will be provided as the year progresses, but the company’s targets reflect confidence in achieving a significant uplift in revenue and profitability post-integration. Investors will be watching closely how the global business investments translate into margin expansion and how the TasmaNet integration drives synergies.
Bottom Line?
Comms Group’s FY25 results set a solid foundation, but the market will be keenly watching TasmaNet’s full integration and the payoff from global expansion investments in FY26.
Questions in the middle?
- How quickly will TasmaNet integration translate into targeted EBITDA growth?
- What impact will increased global staffing have on margins beyond FY25?
- Which M&A opportunities is Comms Group prioritising to accelerate scale?