Comms Group Posts 39% Revenue Surge and 87% EBITDA Jump in 1H FY26

Strong Financial Momentum Powered by TasmaNet and Organic Growth

Comms Group Limited (ASX:CCG) has reported a striking 39% increase in total revenue to $37.6 million for the first half of FY26, alongside an 87.3% jump in underlying EBITDA to $4.5 million. This surge was fuelled by strong organic growth across its Global & Wholesale Unified Communications and Secure Managed IT Solutions divisions, as well as the ongoing integration of the TasmaNet acquisition completed in June 2025. The company’s underlying NPATA doubled to $1.8 million, reflecting improved operating leverage and expanding margins.

Recurring revenue remains a cornerstone of Comms Group’s business model, holding steady above 90%, which supports stable cash flows and underpins the company’s growth ambitions. The integration of TasmaNet is on track, with network and synergy programs approximately 50-60% complete, positioning the firm to realise cost and operational efficiencies in the near term.

Diverse Revenue Streams and Expanding Customer Base

The company’s three core divisions continue to diversify revenue streams: Communications & Collaboration services for SMEs, corporates, and government; Secure Managed IT Solutions including cloud computing and cybersecurity; and Global & Wholesale Unified Communications catering to multinational enterprises and global telcos. The Global & Wholesale division, in particular, posted a 23% organic growth rate, boosted by new contracts with Tier One S&P 500 tech clients and foreign government entities.

Comms Group’s strategic focus on high-quality, multi-year recurring contracts has resulted in low client attrition rates below 5%, ensuring revenue stability despite competitive pressures. The company is leveraging its extensive Asia-Pacific footprint with operations in Sydney, Melbourne, Singapore, London, and beyond, to expand its cloud communications and secure IT offerings to multinational corporations operating across the region.

Balance Sheet Strength and Capital Management

Despite increased capital expenditure of approximately $0.7 million in the half, primarily for network upgrades tied to large client projects, Comms Group maintains a strong balance sheet with $4.0 million in cash and modest net debt of $6.5 million. The company has been actively managing its debt profile, following a refinancing deal secured with Westpac in late 2025, which improved financial flexibility and supports ongoing acquisitions and investments.

Operating cash flow remained steady at $2.4 million, reflecting disciplined working capital management amid integration activities. Free cash flow was impacted by capex but is expected to improve post-FY26 as the synergy program concludes and the business scales.

Growth Strategy Focused on Organic Expansion and Disciplined Acquisitions

Comms Group is targeting over $75 million in annualised revenue and $9 to $10 million in EBITDA for FY26, aiming to increase its EBITDA margin to 15% over time through operating leverage and cost synergies. The company plans to sustain organic growth above 10%, particularly in its Global and Secure Managed IT divisions, while pursuing acquisitions priced between 3x to 6x EV/EBITDA that complement its strategic objectives.

Active M&A discussions are ongoing as Comms Group seeks to consolidate its position in the cloud communications and cybersecurity markets, both of which are experiencing rising demand amid increasing digital transformation and cybercrime concerns. The company’s Secure Managed IT segment, including its Security Essentials offering, is well positioned to capitalise on this trend given the low penetration of cyber response plans among Australian businesses.

Comms Group’s approach to technology investment includes network upgrades and cloud infrastructure consolidation, aiming to create a unified platform and deliver enhanced services to a growing multinational client base. This builds on the company’s recent $75M revenue target post-TasmaNet acquisition and the new 3-year debt facility with Westpac that underpins its financial flexibility.