Ava Risk Group expects FY2026 revenue around $29 million, below prior guidance, due to delayed orders mainly in the Middle East and North America. Despite this, sales intake exceeded revenue, underpinning a strong backlog and positive EBITDA.
- FY2026 revenue forecast lowered to $29 million from $34-37 million guidance
- Delayed orders worth $6 million, primarily Middle East border project
- Sales order intake of $29.4 million exceeds revenue
- Backlog of $6.8 million including $2.6 million recurring revenue
- Positive underlying EBITDA and strong gross margins maintained
Revenue Miss Driven by Timing of Large Middle East and North American Orders
Ava Risk Group (ASX:AVA) is set to report FY2026 revenue around $29 million, falling short of its earlier $34 million to $37 million guidance. The shortfall stems from delays in key orders worth approximately $6 million, notably a $2.8 million sovereign border protection project in the Middle East. This project has been held up by ongoing regional conflict, affecting procurement, site access, and logistics, pushing expected delivery into FY2027. Additional delays include $1.9 million in North American orders related to oil and gas system upgrades and U.S. government sites, now anticipated to close in the first half of FY2027.
Sales Intake Surpasses Revenue, Backlog Provides FY2027 Foundation
Despite the revenue timing setback, Ava Risk Group achieved sales order intake of approximately $29.4 million for FY2026, slightly exceeding expected revenue. This intake has built a sales order backlog of $6.8 million, including $2.6 million in contracted annual recurring revenue. The company expects to convert around $4.2 million of this backlog into revenue during the first half of FY2027. Gross margins remain robust, forecast between 60% and 64%, supporting a modest positive underlying EBITDA for FY2026 and an expected cash balance of $6.7 million at year-end.
Strengthened Commercial Team and Strategic Contracts Signal Growth Potential
The company has bolstered its sales leadership across the United States, Asia-Pacific, and Europe, with senior executives individually contributing between $3.9 million and $5.0 million in annual sales intake. Recent hires in the U.S., South East Asia, and India bring valuable industry expertise and established customer relationships, positioning Ava Risk Group to accelerate growth in FY2027. Notably, Ava Risk Group secured a five-year appointment to the Australian Department of Home Affairs Border Protection Technologies Panel, enhancing its access to Commonwealth contracts and government infrastructure projects.
Key Sector Updates Highlight Diverse Growth Opportunities
In Australia, Ava Risk Group is advancing perimeter intrusion detection system trials at major airports, including Melbourne and Perth, with successful completion expected in early FY2027. The Sydney Metro rail project is nearing completion, having passed a critical object detection test in Q4. In India, the company fulfilled a $2.7 million contract deploying fibre sensing technology to a critical energy pipeline, with final commissioning due in H1 FY2027. The Americas saw $6.2 million in full-year order intake, with ongoing pipeline opportunities in energy and government sectors.
CEO Search Continues as Company Prepares FY2026 Results
Ava Risk Group is actively progressing its CEO recruitment, working with Hale Capital to evaluate candidates. The Board remains engaged, with an announcement expected once the appointment process concludes. The company plans to release its audited FY2026 financial results in late August 2026, which will provide further clarity on the full-year performance and outlook.
Bottom Line?
Ava Risk Group’s FY2026 revenue shortfall highlights the risks of project timing in geopolitically sensitive regions, but a strong backlog and commercial investments set the stage for potential growth next year.
Questions in the middle?
- How swiftly will delayed Middle East projects convert to revenue in FY2027 amid ongoing regional instability?
- Can the expanded sales leadership in key markets translate into sustained order growth beyond backlog conversion?
- What impact will the new government panel appointment have on Ava Risk Group’s contract wins and revenue visibility?