Synertec Corporation has reported its first positive net operating cash flow since FY19, underpinned by strong growth in recurring revenues and a landmark contract with Santos for its Powerhouse energy storage system.
- First full-year positive operating cash flow since FY19
- Powerhouse recurring revenue up 23% with 15 units contracted
- Engineering pipeline expands 60% to $174 million
- Secured $6 million Santos contract for Moomba Central Optimisation Project
- FY27 revenue guidance set between $29.5 million and $31.7 million
Operating Cash Flow Turns Positive After Years in the Red
Synertec Corporation Limited (ASX:SOP) has delivered a notable financial turnaround in FY26, posting its first full-year positive net operating cash flow since FY19 at approximately A$0.5 million. This milestone capped a $4.6 million improvement in operating cash flow, reflecting disciplined cost management and stronger contract execution across its engineering and technology businesses.
The company’s group revenue rose 19% year-on-year to roughly A$21.1 million, driven by a 23% increase in recurring revenue from its Powerhouse energy storage platform, which now has 15 units contracted compared to just three in FY25. Synertec’s engineering pipeline also expanded 60% to $174 million, positioning the business well ahead in securing multi-year infrastructure projects, particularly in water and critical infrastructure sectors.
Powerhouse Technology Demonstrates Reliability and Environmental Impact
Synertec’s Powerhouse battery systems continue to impress with over 99.95% availability recorded across six years of continuous operation, all without fossil-fuel backup. The platform’s performance underpins its appeal in mission-critical applications requiring high reliability and low maintenance, such as remote Queensland operations.
Environmental credentials are strong, with the contracted units expected to reduce approximately 2,400 tonnes of CO₂ equivalent emissions in FY26 alone. The economics of Powerhouse deployments remain attractive, boasting over 90% EBITDA margins and internal rates of return exceeding 27% under the Build, Own, Operate and Maintain (BOOM) model.
Major Contract Win with Santos for Moomba Central Optimisation
Highlighting its growing market traction, Synertec secured a significant contract valued at around A$6 million with Santos for the Moomba Central Optimisation Project. This deal involves deploying two Powerhouse units alongside existing gas-fired generators, enhancing operational flexibility, power system stability, and reducing fuel consumption and emissions at the remote Moomba Power Station.
Scheduled for delivery in the first half of FY28, this contract marks Synertec’s largest single Powerhouse order to date and underscores its expanding footprint in the energy resilience and decarbonisation space.
Engineering Business Benefits from Infrastructure Panel Pre-Qualification
Synertec’s engineering division is capitalising on its pre-qualification across nine major engineering infrastructure panels, granting access to an estimated $7.3 billion in capital programs. The company is well placed to benefit from accelerating investment in water security and critical infrastructure, with contracts secured and pipelines growing notably in New South Wales, Western Australia, and Victoria.
Notably, the Sydney Water SCADA and Electrical Services Panel offers potential project work valued at approximately $245 million over five years. Synertec’s FY26 revenue from NSW and WA stood at $2 million and $1.3 million respectively, with pipelines of $64 million and $30 million in those states.
FY27 Growth Strategy Targets Pipeline Conversion and Margin Improvement
Looking ahead, Synertec has outlined three core measures for FY27: converting and expanding the Powerhouse pipeline, growing the engineering business through geographic expansion and improved margins, and maintaining strict cost discipline to enhance operating leverage.
The company forecasts FY27 revenue between $29.5 million and $31.7 million, alongside an improved EBITDA position. This guidance reflects confidence in converting its $20.9 million contracted growth and a robust pipeline of tenders and expressions of interest exceeding $400 million.
Bottom Line?
Synertec’s FY26 results mark a turning point with cash flow positivity and a landmark Santos contract, setting the stage for scaling its Powerhouse platform and engineering services amid expanding infrastructure demand.
Questions in the middle?
- How swiftly can Synertec convert its substantial engineering pipeline into revenue?
- Will Powerhouse deployments maintain high margins as volumes scale and competition intensifies?
- Can Synertec sustain its cost discipline while expanding geographically and technologically?