WestStar reports $192.5 million revenue after $5 million claim

Contract Claim Turned Expected Loss Into Profit

WestStar Industrial Ltd (ASX:WSI) says a late-stage contract settlement was the decisive factor behind its sharp FY2026 earnings improvement, adding approximately $5 million of revenue to results released on 31 August. Without that amount, the company says it would have reported a loss after tax rather than its reported $3.8 million profit.

The additional revenue related to work completed during the year on a project that had incurred cost overruns. WestStar said the client initially maintained it was not contractually obliged to pay for the work, before verbally agreeing late on Friday, 28 August to enter a confidential deed approving the claim. The deed’s terms had been agreed and were expected to be executed during the week of 7 September, but the response does not confirm that execution has occurred.

ASX Focuses on Results Timing and Cleansing Notice

The disclosure arrived in response to an ASX letter questioning whether the company had information relevant to investors before it issued 10 million shares to a creditor at a deemed price of $0.06 on 21 August. The exchange also pointed to the subsequent jump in WSI’s share price from $0.056 at the 31 August close to an intraday high of $0.10 on 1 September, alongside a significant increase in trading volume.

WestStar told ASX that it began anticipating potentially higher revenue in early June as internal reporting captured the effect of contracts awarded during the year, including work for Tianqi Lithium, Alcoa, Fortescue and McArthur River Mining. It said, however, that the final revenue increase was not known until 31 August because revenue depended on stage-of-completion calculations, progress claims and client acceptance, which can occur weeks after a claim is submitted.

The company said it obtained a high degree of certainty about the contract claim late on 28 August. Its tax advisers completed their review on the morning of Monday, 31 August, after which the relevant tax benefit was included in the results. WestStar said it did not believe there had been a variance from market expectations requiring earlier disclosure, noting that it publishes no earnings guidance, has no sell-side analyst coverage and had previously announced major contracts and their expected timing.

Strong Headline Growth With a Material One-Off Question

FY2026 revenue rose 47.2% to $192.5 million, while net profit after tax increased 211.6% from a $3.4 million loss in FY2025 to $3.8 million. EBITDA climbed 1,195.6% from $507,045 to $6.6 million. Those comparisons look dramatic partly because the prior year was unusually weak: FY2024 revenue was $205.6 million, net profit was $3.3 million and EBITDA was $8.2 million.

WestStar said the contract claim flowed almost directly through to EBITDA and net profit because the associated project costs were already included in its accounts, apart from tax on the additional amount. That accounting explanation makes the deed and the status of the claim important next steps, particularly because the FY2026 figures described in the filing were preliminary and unaudited.

WestStar confirmed that its responses had been authorised under its disclosure procedures and stated that it remained compliant with the ASX Listing Rules, including Listing Rule 3.1. It also said it had no known explanation for the trading activity after the results announcement. The unresolved point is narrower but consequential: whether ASX accepts the company’s account of when the earnings information became sufficiently certain to require disclosure.