SKS Technologies Posts 33% Revenue Growth and Near-Doubles Profit in FY26

• 33% revenue increase to $347.9 million
• 93% rise in net profit after tax to $27.1 million
• Delta Elcom acquisition expands NSW data centre footprint
• Order book grows 56% to $312 million
• Dividend raised 66.7% to 10 cents per share

Record Financial Performance Anchored by Data Centre Boom

SKS Technologies (ASX:SKS) has smashed through previous records in FY26, reporting a 33% jump in sales revenue to $347.9 million and an almost doubling of net profit after tax to $27.1 million. The company’s profit before tax soared 89.3% to $39.35 million, with margins expanding notably to 11.2% from 8.0% the year prior. Earnings per share surged 91.2% to 23.45 cents, reflecting the scale of the company’s operational leap.

The standout driver remains SKS’s dominant position in the hyperscale data centre sector, where revenue climbed 47.6% to $207.7 million, now accounting for nearly 60% of total sales. Traditional business lines, including audio visual, communications and electrical solutions, also contributed a solid 16% revenue increase to $140.3 million, underscoring a diversified growth base.

Strategic Acquisition and Geographic Expansion

Integral to SKS’s growth narrative was the January 2026 acquisition of Delta Elcom, a Sydney-based specialist in data centre infrastructure and integrated electrical solutions. This move was less about incremental revenue and more about securing a foothold in Australia’s largest data centre market of New South Wales, complementing SKS’s strong Victorian presence. The acquisition has been fully integrated, with SKS now operating nine sites nationally under one brand and culture.

Further cementing its Victorian credentials, SKS established a new 6,200 square metre major projects headquarters in Melbourne’s north-west, strategically located within the burgeoning data centre development corridor. This facility is designed to boost productivity across engineering, design, prefabrication, and on-site commissioning, while fostering stronger client engagement.

Order Book and Pipeline Reflect Sustained Momentum

The company’s order book swelled 56% over FY26 to $312 million, a figure that has grown at an annual compound rate of 113.7% over the past five years. The tender pipeline remains robust at $1.69 billion, with 87% of tenders focused on data centre projects. SKS’s ability to convert pipeline opportunities into contracted work has been a cornerstone of its rapid expansion.

Major contracts secured during the year include a record $210 million hyperscale data centre project in Melbourne, a $28 million early works contract for the MEL2 data centre, and significant projects for clients such as Coles, Ernst and Young, and the Australian Defence Force. SKS Indigenous Technologies also continued its growth trajectory, now employing 43 electrical apprentices and qualified electricians nationwide.

Operational Excellence and Safety Culture

Despite a 22.7% increase in workforce and a 32.1% rise in productive hours, SKS maintained an impeccable safety record with zero lost time injuries for the year, a remarkable feat in the industry. The company’s investment in site-specific plant and equipment, alongside enhanced cyber security measures aligned with the Essential Eight framework, underpins its operational platform designed to support sustained growth.

SKS also rolled out a company-wide leadership program and an Integrated Management System to strengthen governance and compliance, reflecting a holistic approach to scaling operations without compromising safety or quality.

Strong Balance Sheet Fuels Ambitious FY27 Outlook

SKS Technologies closed FY26 with $49.6 million in cash reserves, up 52.7% year-on-year, and secured a 62.5% increase in bank facilities to $52 million, providing ample financial flexibility. While net cash flows dipped due to the $10.88 million cash component of the Delta Elcom acquisition and increased capital expenditure, normalised cash flows remained broadly consistent with the prior year.

Looking ahead, SKS’s board anticipates FY27 sales revenue approaching $500 million and profit before tax of around $60 million, continuing the company’s trajectory of robust growth supported by a surging data centre market and diversified traditional projects.

Bottom Line?

SKS Technologies is leveraging its strategic acquisitions and operational scale to capitalise on a booming data centre market, but sustaining such rapid growth will require careful management of costs and integration risks.

Questions in the middle?

• How will SKS balance rapid expansion with maintaining its zero lost time injury safety record?
• What impact will rising interest rates and inflationary pressures have on SKS’s cost base and margins?
• Can SKS continue to convert its sizeable tender pipeline into profitable contracts amid increasing competition?