Redox enters FY27 from a position of record revenue, higher margins and a debt-free balance sheet, while its North American business passes $100 million in sales. The chemical distributor also reported 9% higher average selling prices in the first quarter, although volumes remained broadly flat and freight costs increased.
- Record FY26 sales revenue of A$1.330 billion, up 6.9%
- Net profit after tax rose 19.2% to A$92 million
- North American sales increased 33.8% to more than A$100 million
- FY27 first-quarter prices rose about 9%, with volumes broadly unchanged
- A$123 million in cash and zero net debt support potential acquisitions
North American sales pass A$100 million
Redox Limited (ASX:RDX) is taking its strongest regional growth story into FY27, with North American sales rising 33.8% during FY26 to more than A$100 million. The chemical and ingredients distributor said customer conversions and increased share of wallet across industrial, food, human health and personal care helped drive the result, alongside growth in the recently established US Southeast region and an initial success in Canada.
The figures were presented at Redox’s annual general meeting, where the company also revisited its record FY26 performance. Sales revenue rose 6.9% to A$1.330 billion, gross profit increased 11% to A$298 million and net profit after tax climbed 19.2% to A$92 million. Earnings per share increased 20%, while gross margin improved to 22.4% as product mix strengthened in Asia-Pacific and North America’s margin profile improved. The AGM presentation described the FY26 results and leadership transition as the backdrop to the company’s next phase, after earlier coverage reported the same profit and board changes.
Pricing improves as freight costs rise
Redox’s first-quarter update offers the clearest early read on FY27. Average selling prices were about 9% higher than the prior corresponding period, while volumes sold were broadly in line with a year earlier. Gross profit margins remained resilient and above the FY26 level, according to the presentation.
That improvement is not cost-free. Inbound sea freight and outbound freight expenses continued to rise, which the company attributed to inflationary pressures including fuel costs. The contrast matters: pricing is now moving more decisively, but the durability of the margin improvement will depend partly on how much of the higher logistics burden can be absorbed or passed through.
Cash-rich balance sheet leaves acquisitions open
Redox completed no acquisitions during FY26, but management said its domestic and international opportunity pipeline remains active. With A$123 million in cash and cash equivalents, zero net debt and what it described as a conservatively geared balance sheet, the company said it is positioned to fund suitable acquisitions, with North America receiving increased strategic attention.
The board declared a total FY26 dividend of 13 cents per share, 4% above FY25 and equivalent to 74% of net profit after tax. That sits within Redox’s stated long-term payout range of 60% to 80%, leaving the company presenting both shareholder distributions and expansion capacity as compatible priorities rather than competing claims.
Chair transition adds a governance milestone
Ian Campbell is retiring as chair following the AGM, with Mary Verschuer succeeding him. Shareholders also elected Sheila Lines as an independent non-executive director. Executive performance rights for FY27 will be split between relative total shareholder return and earnings-per-share growth, giving the incentive structure two equally weighted hurdles.
For FY27, Redox says it will pursue organic growth and acquisitions while managing inventory, logistics costs and a volatile inflationary environment. It also plans to use artificial intelligence selectively and continues to rely on its internally developed Redebiz system, alongside ongoing cyber and information-security testing. The next substantive question is whether the early pricing improvement can translate into sustained volume and margin growth without narrowing the financial room available for acquisitions.
Bottom Line?
The early FY27 indicators are constructive, but the investment case now turns on whether higher prices become durable earnings growth while freight costs and acquisition ambitions compete for attention.
Questions in the middle?
- Can Redox sustain its above-FY26 gross margins as freight and fuel costs continue to rise?
- Will North American growth produce a larger contribution to group profit, not just sales?
- How quickly could the acquisition pipeline convert into announced transactions, and on what terms?