5G Networks Reports $71.4M Revenue and $1.6M Underlying EBITDA in FY26

Revenue Growth Driven by Enterprise and Cyber Security

5G Networks Limited (ASX:5GN) reported a 13% increase in revenue to $71.4 million for the year ended 30 June 2026, propelled primarily by a 24% surge in its enterprise segment to $52.4 million. This growth was underpinned by cloud, managed IT, and notably cyber security services following its acquisition of a controlling 90.03% stake in AUCyber, a specialist in sovereign cloud and cyber security solutions.

While wholesale revenue declined by 9% to $19 million, the company’s pivot towards higher-margin enterprise services and cyber security helped lift gross profit 14% to $34.9 million, maintaining a solid gross margin of 48.9%. Hardware and software sales also jumped 54%, reflecting strong market demand and a robust sales pipeline heading into FY27.

Underlying EBITDA Positive Despite Integration Costs

5GN delivered a positive underlying EBITDA of $1.6 million, a decline from $3.2 million the previous year. The decrease reflects increased investment and overheads associated with integrating AUCyber’s operations and capabilities. The net loss after tax widened to $12.2 million, impacted by these costs as well as depreciation, amortisation, and share-based payments.

The company’s cash position stood at $14.6 million at year-end, including $3.3 million in restricted cash securing bank guarantees on property leases. This strong balance sheet supported a $4.7 million return to shareholders through an on-market share buyback, demonstrating capital discipline amid strategic investments.

Strategic Review Targets Full AUCyber Integration

The Board has initiated a strategic review focused on integrating managed IT, sovereign cloud, and cyber security services into a unified entity under the AUCyber brand. This move aims to unlock operational synergies, improve efficiencies, and enhance shareholder value. The rebranding effort during FY26 sharpened the company’s security focus and simplified customer communication across enterprise and government segments.

5GN’s data centre infrastructure spans Melbourne, Sydney, Brisbane, and Adelaide, with a total power capacity of 4.2MW, approximately 2.2MW of which remains unmonetised. Management views this spare capacity as a significant growth opportunity that could generate over $5.6 million in additional annualised incremental margin without substantial capital expenditure.

Risks and Legal Matters Highlighted

The company disclosed ongoing legal proceedings related to a commercial lease dispute with a former landlord, 148 Brunswick Street Pty Ltd. While the claims include damages and future rent, 5GN disputes the amounts claimed and considers the financial exposure uncertain and not material at this early stage.

Other risks include competitive pressures, rapid technological changes, cybersecurity threats, regulatory compliance, and the need to maintain key licences and accreditations essential for operations as a licensed telecommunications carrier.

Governance and Remuneration Updates

5GN’s Board comprises four directors, including independent Chair Hugh Robertson Jnr, Managing Director Joseph Demase, and two other independent non-executive directors. The company operates a Nomination and Remuneration Committee, though no formal meetings were held during FY26, with informal evaluations conducted instead.

Remuneration expenses increased, reflecting share-based payments and integration-related costs. The Managing Director’s total remuneration was over $1 million, with a significant portion linked to performance rights and share options designed to incentivise long-term growth.

5GN did not pay dividends during FY26, maintaining focus on reinvestment and integration efforts.