Synertec Faces Economic Headwinds but Powerhouse Tech Sparks Growth
Synertec Corporation reported resilience in FY25 despite sector headwinds, with a strong rebound in engineering profits and a 90% revenue jump in its renewable Powerhouse technology.
- 8% revenue decline to $18.2 million amid sector-wide slowdowns
- Engineering segment normalised EBITDA up 186% to $2.2 million
- Major panel appointments secured with Sydney Water and WA Water Corporation
- Powerhouse renewable microgrid revenue grows 90% to $2 million
- Strong FY26 pipeline and ongoing contract negotiations signal growth
Strategic Renewal and Leadership Changes
Synertec Corporation Limited (ASX – SOP) entered FY25 navigating a challenging macroeconomic environment, particularly within Australia's engineering sector. The company undertook a significant strategic renewal, including a board transition with Johannes Risseeuw assuming the chairmanship in early 2025 and key executive appointments such as Yash Gala as CFO and David Harris as Head of Technology Solutions. These leadership changes have injected fresh perspectives, enabling Synertec to sharpen its focus on sustainable, long-term growth.
Financial Performance Amid Sector Headwinds
Despite an 8% decline in total revenue and other income to $18.2 million, Synertec demonstrated operational resilience. The engineering division, which forms the backbone of the business, delivered a normalised EBITDA of $2.2 million, a remarkable 186% increase from the prior year. This turnaround was driven by decisive management actions including a company-wide restructure and a 25% workforce reduction, which helped the business rebound strongly in the second half of the year.
Strengthening Market Position Through Panel Appointments
Synertec’s strategic focus on five core sectors, Water, Transport, Energy & Resources, Life Sciences, and Defence & Manufacturing, has paid dividends. The company secured major panel appointments with key water utilities, including the Western Australia Water Corporation and Sydney Water SCADA and Electrical Services Panels. These appointments provide Synertec with exclusive access to significant capital projects, multi-year revenue visibility, and a strong competitive moat, underpinning future growth prospects.
Powerhouse Technology – A Renewable Energy Breakthrough
The company’s proprietary Powerhouse technology, an AI-driven, 100% renewable microgrid power system, continues to gain traction. Powerhouse revenue surged 90% to $2 million, supported by strategic partnerships with global battery and technology suppliers. The technology has proven its reliability with over five years of fossil-fuel-free power delivery at more than 99.9% availability for Santos in remote Queensland. Its expanding applications now include grid support and energy arbitrage, broadening its market potential significantly.
Outlook and Future Opportunities
Looking ahead, Synertec is well positioned to capitalise on a robust pipeline of engineering tenders valued at $86 million and ongoing negotiations for additional Powerhouse units. The company’s commitment to sustainability, governance, and operational excellence, combined with potential regulatory tailwinds from the Environment Protection Reform Bill 2025, sets a promising stage for FY26 and beyond.
Bottom Line?
Synertec’s strategic reset and technology innovation have laid a strong foundation, but market and regulatory developments will be key to sustaining momentum.
Questions in the middle?
- How will the Environment Protection Reform Bill 2025 impact Powerhouse adoption and revenue?
- What is the timeline and scale for converting the $86 million tender pipeline into contracts?
- Can Synertec expand its presence in underrepresented sectors like Resources and Defence?
