Eneco Refresh Limited reported a 7% increase in total revenue for the fourth quarter of FY26, driven by gains in Western Australia, Victoria, and its plastics segment. The company managed raw material price volatility effectively and maintained positive operating cash flow.
- 7% revenue growth in Q4 FY26 compared to prior year
- 46% surge in Refresh Plastics revenue due to resin price volatility
- Western Australia and Victoria segments show strong gains
- Operating cash flow positive at $661,000 for the quarter
- No new financing facilities drawn; net cash increased by $4.6 million
Revenue Growth Driven by Regional Strengths and Plastics Surge
Eneco Refresh Limited (ASX:ERG) delivered a solid 7% increase in total revenue for the fourth quarter ended June 2026, reaching $4.22 million compared to $3.93 million in the prior year. This growth was primarily fuelled by strong performances in Western Australia and Victoria, alongside a remarkable 46% uplift in the Refresh Plastics segment.
Western Australia’s revenue rose 4% to $1.35 million, while Victoria recorded a 23% jump to $659,000. The company attributed the Victorian growth partly to a change in accounting practices that now allocates custom label water bottle revenues to the state where sales occur, shifting some previously NSW-attributed revenue. This accounting shift explains the 11% decline in New South Wales revenue to $683,000, despite stable underlying operations.
Refresh Plastics Navigates Resin Price Volatility
The Refresh Plastics business capitalised on volatile plastic resin prices during the quarter, which led to significant pricing adjustments and a $240,000 revenue boost. Several customers placed large orders to benefit from volume-based price breaks amid uncertainty caused by the Middle East conflict. Eneco warns that if resin prices revert to pre-conflict levels, pricing may be adjusted downward, potentially impacting future sales revenue.
Despite this uncertainty, the Board expressed confidence in senior management’s handling of raw material and logistics cost volatility, emphasising their vigilance in adapting to market shifts and mitigating risks.
Stable Operations and Positive Cash Flow
Operating costs rose moderately, with product manufacturing and operating expenses increasing to $2.41 million for the quarter, and staff costs, including $32,634 in director fees, reaching $1.51 million. Advertising and marketing expenses declined slightly to $41,000.
Cash flow from operating activities remained positive at $661,000, contributing to a net increase in cash and cash equivalents of $4.63 million for the quarter. Eneco ended June 2026 with $5.02 million in cash reserves and no drawn financing facilities, maintaining a solid liquidity position to support ongoing operations and growth initiatives.
Outlook Anchored by Leadership and Market Adaptability
The company reiterated its commitment to continuous improvement in manufacturing processes and market strategies. The senior management team remains focused on delivering profitable growth despite external uncertainties, including raw material price fluctuations and logistics costs.
Quarter four is traditionally the lowest sales period for drinking water, with Eneco using this time for equipment maintenance and project work, setting the stage for stronger performance in upcoming quarters.
Bottom Line?
Eneco Refresh’s ability to manage raw material volatility while growing revenue and cash flow highlights resilient operations, but future earnings may hinge on stabilising resin prices.
Questions in the middle?
- How will Eneco Refresh adjust pricing if plastic resin costs decline post-conflict?
- Can the company sustain growth momentum in Victoria following the accounting changes?
- What strategies will management deploy to mitigate ongoing logistics cost volatility?