Big River carries FY26 momentum into FY27 with 10.5% revenue growth

First-quarter growth extends Big River’s earnings recovery

Big River Industries (ASX:BRI) has opened FY27 with double-digit earnings growth, as first-quarter revenue rose 10.5% to $117.6 million and gross margin expanded by 40 basis points to 26.7%. The update gives the building-products distributor and manufacturer an encouraging start in markets where residential demand remains soft and uneven.

Management attributed the revenue increase partly to the addition of Johns Building Supplies, alongside continued progress in cladding, bespoke decorative panels and high-end plywood. It said new decorative-panel releases and demand for differentiated products were supporting a stronger mix, while cost discipline helped translate higher sales and margins into double-digit earnings growth.

FY26 delivered stronger margins, cash flow and balance sheet metrics

The first-quarter performance follows a year in which Big River improved earnings faster than sales. Revenue increased 5.3% to $426.4 million in FY26, underlying EBITDA rose 8.4% to $31.1 million and underlying net profit after tax climbed 20.5% to $5.2 million. Gross margin increased 30 basis points to 26.5%, supported by pricing, product mix, procurement and supplier-alignment initiatives.

That progress was accompanied by cash conversion of 101.5% and a reduction in gearing to 17.9%, from 20.1%. The company declared a fully franked final dividend of 2 cents per share, taking the full-year distribution to 4 cents, unchanged from FY25. The result builds on the FY26 earnings recovery, which had highlighted stronger EBITDA and lower gearing after the JBS acquisition.

Johns Building Supplies contributed $25.2 million of revenue and $3.1 million of EBITDA in FY26, according to the AGM presentation, and Big River said the Western Australian business was performing ahead of initial expectations. The acquisition strengthened the group’s presence in a market it identifies, alongside South Australia, as relatively stronger than softer eastern-state regions.

Strategic review remains open while operations take priority

The board is still assessing strategic options with Greenstone Partners, saying it believes the share price does not reflect the business’s long-term value. The review remains ongoing and Big River cautioned that there is no certainty of a transaction or any other specific outcome. Management, meanwhile, says it remains focused on executing the existing growth program rather than waiting for the review to resolve. The process follows the Greenstone strategic review, which was launched as the company pursued stronger FY27 growth.

The near-term operating backdrop is mixed. Commercial and formwork activity is expected to remain comparatively resilient, while residential demand continues to face affordability pressure, weak sentiment and project delays despite a strong future-work pipeline. New Zealand’s project pipeline is improving, but underlying conditions there are expected to remain relatively soft over the next six months. Against that backdrop, Big River says margin initiatives, working-capital discipline and its focus on higher-value products support confidence in growth above market, without providing specific FY27 earnings guidance.