Mitchell Services Surges to Profit with 69% EBITDA Jump and Declares 4c Dividend

Robust Financial Turnaround

Mitchell Services Limited has posted a strong rebound in its half-year results for the period ending 31 December 2025, with revenue climbing modestly by 3% to $102.4 million. More strikingly, EBITDA surged by 69% to $21.4 million, driving the company back into profitability with a net profit after tax of $8.1 million, a significant turnaround from a loss of $0.3 million in the previous corresponding period.

This financial improvement reflects a combination of factors including better weather conditions, fewer client-related delays, and the maturation of projects that had previously incurred ramp-up costs. Despite a relatively stable rig count averaging 61.7 rigs, the company increased its operating shifts by 6%, boosting productivity and revenue.

Operational Highlights and Market Position

Mitchell Services continues to serve predominantly Tier 1 multinational mining clients, with a balanced revenue split between surface and underground drilling. The company’s strategic pivot towards gold sector projects is evident, with gold-related revenue rising to 58.2% of total income, up from 42.2% a year earlier, reflecting strong gold prices. Meanwhile, steelmaking coal’s share declined to 32.8%, and the geographic revenue mix shifted with increased contributions from Victoria and Papua New Guinea.

The company’s diversified service offering spans the entire mining lifecycle, including exploration, feasibility, resource definition, development, production, and decarbonisation solutions. This breadth helps mitigate the cyclical nature of commodity markets and supports stable operational performance.

Disciplined Capital and Cash Flow Management

Capital expenditure was tightly controlled, falling 44% to $6.7 million, focusing mainly on essential maintenance rather than expansion. This discipline, combined with strong operating cash flow of $20.8 million, nearly doubling from the prior period, enabled the company to reduce net debt to a net cash position of $7.2 million at half-year end.

The company also recognised a non-cash impairment loss of $1.4 million due to a bushfire destroying a drill rig and ancillary equipment in Western Australia. However, this loss is fully insured, and the insurance claim process is well advanced, mitigating any lasting financial impact.

Strategic Ventures and Dividend Declaration

Mitchell Services is advancing its decarbonisation strategy through its 50/50 joint venture Loop Decarbonisation Solutions Pty Ltd, which recently attracted a strategic equity investment from Sumitomo Corporation. This partnership aims to capitalise on emerging regulatory requirements for emissions reduction in mining operations.

Reflecting confidence in its financial position and outlook, the Board declared a fully franked interim dividend of 4.00 cents per share, payable on 17 March 2026. This marks a return to shareholder distributions following a pause during the prior transitional year.