Thank you very much. Good morning, everyone. Presenting with me today are my fellow directors, Mark Vartuli, Jason Pryde, and Trent Northover. At Tasmea , we do many things differently. Whilst we're collectively very proud of our FY 2025 results, we'd like to commence today's presentation by providing an update on our outlook for FY 2026. We have provided to the market in June strong guidance and outlook. We now can confirm we have a record order book of $600 million. We forecast FY 2026 net profit after tax of $70 million, up 32% from our record result in FY 2025 of net profit after tax of $53 million. We're exposed, arguably, to very strong structural tailwinds. Those trends include electrification, the benefit of working remotely, the fact that we maintain aged fixed plant.
We do brownfield upgrades, and we're working in some of the hottest sectors in the country: mining, energy, infrastructure replacement, and renewable energy. Importantly, we convert our EBIT into cash. We've got a very strong conversion rate, 101% for the last five years. That's driven by our high recurring revenue base under master services agreements, where we bill at the end of the month and get paid promptly thereafter. Furthermore, we generate industry-leading margins from our self-performance of diversified specialist skills, and we cross-sell, which adds to our margins. Our EBIT margin FY 2025 is 13.5%, which is twice our peer average. We continue to consistently deliver net profit after tax, earnings per share, and dividend per share growth. Our four-year CAGR for net profit after tax is a whopping 53%.
As a result of issuing a few shares, our earnings per share are up 47% over the last four years, dividends per share are up 53%. Really importantly, in addition to growing dividends, we continue to invest in value accretive programmatic acquisitions. Our share value has appreciated since IPO 172%. In fact, looking at this morning's numbers, maybe a little bit more than that. As we look forward, we've got a very strong organic growth and acquisition pipeline. Importantly, we are taking time to invest in our foundation. We invest in our people. We invest in our systems in order to handle the challenges of rapid growth. We've increased the number of MSAs that we have from 41 to 70. Really importantly, we've got a proven growth model. When we acquire businesses 4x-5x , we generally get to acquire them because their growth is constrained.
We address that constraint, and when integrated into our business, their earnings are worth 10 x. Every time we buy, we create shareholder value. We've got a strong pipeline of opportunities that are currently under consideration, and most importantly, we've got the balance sheet strength and the funding to continue to grow programmatically. Next page, please. In terms of last year, revenue $548 million, up 37%. EBIT $74 million, up 60%. EBIT margin 13.6%, double our peer average and up 200 basis points. Statutory net profit after tax $53 million, up a thumping 74%. Earnings per share $0.23, dividend per share, final dividend double what last year's was of $0.06, taking our total dividends for the year to $0.23. Next page, please. One of the points I'm keen to make about our earnings is not a surprise.
They're strong, they're consistent, and we've been growing like we grew last year for the previous five years. If you look at pro forma EBIT, which is the full year of the businesses we acquired, adjusted for months off, last year it's $93 million, up from some $30 million five years ago, and compound aggregate growth 33%. If I look at net profit after tax, $63 million, up from $18 million in FY 2021, compound aggregate growth 36%. If we turn to the audited results, statutory EBIT this year $74 million, up from $18 million, 42% compound aggregate growth. Net profit after tax, which in some respects all that matters other than cash and what you pay dividends out of, $53 million, up from $11 million, 53% compound aggregate growth. Let me share with you the trend is your friend. Next page, please.
In terms of dividends, we are focused on shareholder wealth. We've declared dividends last year of $0.11, that final dividend of $0.06. Ordinary dividends $0.11, 47% payout ratio. If you add in the special dividend, and I appreciate the support that many of you gave us in converting your special dividend to shares, $0.23. Because of that dividend reinvestment, the effective cash payout was only 36%. Next page, please, and let me hand over to my colleague, Mark Vartuli.
Thank you, Stephen, and morning, everyone. Tasmea has a high cash conversion operating model. Our EBIT to operating cash flow for the last five years has averaged 101%. This year, it was 88% for FY 2025. This is driven from our focus on shutdowns and maintenance via invoicing from our master services agreements on scheduler rates. Every month we invoice, every month we collect. Investing cash flows, $57 million paid out for acquisitions during FY 2025 and $14.5 million for staying business CapEx. Net financing cash flows was net borrowings of $26 million after paying dividends, lease payments, and funding our programmatic acquisitions, of which there were four during the year. Free cash flow for the year was $25 million. Next page, please. Tasmea is well positioned to fund growth, given our strong balance sheet.
We have received an offer to increase our banking facilities and extend the terms of our facilities at more competitive rates, which we are documenting as we speak. Our capacity to fund programmatic acquisitions remains strong, with $25 million in free cash flow and the supportive financier committed to partnering with Tasmea to accelerate our growth. We have strong cash conversion. We have net debt to pro forma EBITDA trailing at 1x , which reduces every month given our strong operating cash flow conversion. We have a very low business model risk. We do not require cashback bank guarantees as we're in maintenance, not lump sum money construction, and our bank guarantees as percentage of pro forma revenue is only 2%.
Our effective cash payout dividend ratio is less than 36% for all dividends, including the special dividend, given the strong dividend reinvestment takeup from the founders and executive directors, who have since IPO invested more than $30 million back into Tasmea. Tasmea generates a high return on capital employed at circa 31.7%. Our return on equity on a pro forma basis was 39.5% for the year. Next page, please. Tasmea operates under a strict capital management framework in order to deliver growth and shareholder returns. As mentioned, we have a strong operating cash flow model, averaging 100% for the last five years. We generate free cash flow, which we invest in programmatic acquisitions, gross CapEx, given our light business model, which translates into a strong balance sheet, given our low-risk business model of not requiring cashback guarantees.
Our low trailing net debt to EBITDA of 1x , which is reducing every month given our strong OCF. We apply these to shareholder returns with a targeted 30% - 50% payout ratio. However, after DRP participation by the major shareholders, this is significantly less, which enables us to invest our excess cash back into cash-generating organic growth opportunities, earnings accretive programmatic acquisitions, and continue to pay dividends. Next page, please. Just want to touch on our outlook and momentum into FY 2026 and beyond. We've reconfirmed our guidance for FY 2026 of $110 million EBIT, $70 million MPAT, which is up 32% on our record FY 2025 year of $53 million. Our pipeline of revenue and earnings visibility remains very optimistic with lots of opportunities in front. We've generated 73% from acquisitions EBIT compounding annual growth since FY 2022.
We're able to extract value from buying at 4x-5x EBIT and then plugging into our EBIT multiple of 10 +, and then cross-selling revenue synergies in growing those earnings. As Stephen mentioned, we have a strong pipeline of earnings accretive acquisition opportunities, which we are pursuing. When combined with the programmatic acquisitions with our organic growth track record, which has delivered 33% EBIT compounding annual growth since FY 2022, which is well above our internal target of 15%, we're seeing significant strong opportunities in the electrification space. We're also identifying and executing on significant cross-sell opportunities in our group. This has led for us to be able to increase our EBIT margin to 13.6% in FY 2025, or on a pro forma basis, almost 15%, which is up from 8.9% in FY 2022.
This expansion has been delivered by our vast array of specialist services and the ability to cross-subsidize by self-performing those rather than subcontracting. In respect of our EBIT guidance of $110 million, I do also point out that that assumes no additional programmatic acquisitions. I'll ask Trent now to talk about our revenue pipeline. Next page, please.
Thank you, Mark, and good morning, everyone. As you can see on the diagram on the left-hand side, we've gone from $465 million order book last year to $600 million this year. This is up circa 30%. We put a considerable focus on driving MSA awards. Since IPO, as we've discussed, we've gone from 41 to above 70. Most of these MSA terms are three-year terms plus one plus one options. Jason and Stephen have touched on this in our last roadshow. However, it's really important to note that if we maintain our existing customers, we'll naturally grow with them. Of note, 94% of our revenue last year came from repeat customers. As per our purpose of delivering value always, a considerable focus has been placed on delivering more value to the customers, both at corporate and at site.
This is only possible thanks to our employees. Our culture enables us to deliver the financial results you see here today. Next page, please. With regards to the market outlook, Tasmea are across all key commodities with specific alignment to iron ore, copper, and gold. Iron ore volumes are rising, therefore assets are running harder. We feel Tasmea Limited's specialized services ensure the high reliability of these assets, primarily linked to our MSA and ability to rapidly respond to the client's requirements. We're also using our ability to self-perform asset life extension projects within the group of Tasmea . With regards to gas, gas is certainly back in vogue. We are seeing strong investment in the domestic gas market with specific focus on supporting our customers at Santos, Beach, and Woodside.
As we look to the future, we're focused on specialist electrical upgrades, communication networks, and ongoing maintenance with strong demand for data centers coming through, which leads us to Jason's slide up next. Over to you, Jason.
Thanks, Trent, and good morning, everyone. We're experiencing strong electrification tailwinds due to the energy transition to renewables. This means there is significant transmission, distribution, and storage infrastructure required. We deliver end-to-end electrical solutions from design and engineering through to commissioning and maintenance. We're uniquely positioned to assist during the installation, but focused on being there to maintain the asset for its entire life cycle. The commercial outlook remains strong. We see our top customers focused on their net zero journeys, and we're there to support them. It is no coincidence why our electrical segment has grown significantly in FY 2025. Next page, please. Yura Yarta, 51% Indigenous owned, 49% Tasmea owned. Together, we are focused on creating Indigenous employment opportunities. Our Indigenous owners work in the business. We're Supply Nation certified. Our Indigenous workforce is 100% Indigenous, which is very unique.
All Yura Yarta employees are being mentored or trained to improve their skills by our Indigenous leadership and supported via the Tasmea Learning Academy. We're proud to say today that we currently have 56 Indigenous employees employed in Yura Yarta. Next page, please. Addressing investor priorities. Number one, increasing earnings. We've given strong FY 2026 guidance of $70 million statutory MPAT t hat's 32% year-on-year growth. Our twin pillar strategy of growing earnings organically and via programmatic acquisition is achieved by keeping what we have, building our market share, increasing cross-selling opportunities, and providing new services to existing customers. Growing our earnings through value accretive programmatic acquisitions, the attraction, recruitment, retention, and development of specialist trade skills people continues to remain a key focus and enabler for our future growth. We're improving our margins.
We're focused on acquiring specialized high-margin businesses whilst driving revenue synergies through cross-selling and organic growth of our higher margin businesses, continues to compound margin accretion. This increases our capability to self-perform contracts rather than subcontract, sets us apart from our peers. We're diversifying our earnings, increase our exposure to structural long-term growth trends in electrification and civil through our recent acquisitions of the Future Group, Vertex Group, and Flanco Group. Our largest commodity level exposure in iron ore has reduced from 52% in FY 2024 to 38% in FY 2025. Diversification of our businesses and exposure to the six essential industries is a core strength. We're increasing our dividends. We're growing our earnings base both organically and via our programmatic acquisitions, which leads to higher shareholder dividends whilst maintaining capital discipline.
Our balance sheet strength positions us to take advantage of opportunistic growth investments, strategic acquisitions, and capital return opportunities without compromising our financial resilience. Risk management. Tasmea does not trade. Tasmea does not provide parent guarantees to protect our equity other than to our financiers. Our portfolio of 25 subsidiaries individually contract and trade. We're focused on recurring revenue, maintenance not construction, and production not exploration. Our blue chip customer base with an increasing number of master services agreements, like we've previously said, from 41 at IPO to over 70 today. We're a founder-led organization. Over 60% of the founders are still involved in the businesses that they started today. We've got a highly aligned executive management team with over 100 participating in our long-term incentive plan, providing strong employee-owner-operator culture.
Founders and executive directors have invested over $30 million since IPO, underlying our confidence in the future of the business, driving shareholder alignment. I'll now hand back to Stephen for some closing comments.
Thank you, Jason. Tasmea is led by the individuals presenting to you today, and collectively, we own more than 60% of Tasmea. Part of the benefits of the IPO has enabled us to offer equity to our direct reports, and now more than 100 employees are participating in our long-term incentive plan. We did set that out in our IPO. You will recall that our prospectus revealed an EBIT of $55 million, and we were seeking under the long-term incentive plan to grow that to $110 million over a three-year period. In addition to that, for an employee to get the benefit of the long-term incentive, which is 100% of their FY 2027 salary in Tasmea shares, they had to not only, did Tasmea need to earn $110 million, but they had to grow their business's EBIT by 15%.
I'm really pleased to announce that we expect to hit that target before the conclusion of FY26. We'll make $110 million EBIT next year. As a consequence of those earnings, we expect to enter the ASX 300 in March next year. Really importantly, that $110 million goal is being achieved one year early. As a result of that, we can now focus on Jason's Executive Director tranche two benefits, which requires we hit an EBIT of $135 million. For him to grow his business, Tasman Power, by 15%, he's already hit that hurdle for FY 2027 two years early. The year after, $160 million. We expect, and I have to say, this is an aspiration, not a guidance. We're not guiding for 2028 or 2029 yet, but we're planning to hit both those hurdles one year early. In summary, what am I trying to say?
We believe the best is yet still to come. We thank you for your support. We hope that it will continue, and we look forward to continuing our purpose of delivering value always. Thank you, and I'm happy to answer questions.
Thank you. If you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two. If you are on a speaker phone, please pick up the handset to ask your question. Your first question comes from Megan Kirby- Lewis and Barrenjoey . Please go ahead.
Thank you. Morning, guys. My first question is just on Mark's organic first acquisition chart, slide nine. Just keen to understand the big step up in organic growth into FY 2026. What are the key drivers? Thanks.
Thanks, Megan. What's driving that, obviously, is the order book, which Trent talked about earlier, which is up circa 30% on last year. The other matter that's driving that is there's just an increase in demand for our specialist services. We're becoming far more effective at the cross-sell of the opportunities within our businesses because we're quite unique in our service offering across the 25 specialist subsidiaries to be able to offer a full array of services that is very unique. Our customers are trying and are now moving more towards buying the specialist services rather than getting all of the services through one company and then having that company sub it out. They're seeing more value by direct engaging the specialist service. I hope that's answered your question.
Megan, just to add to that, I think FEG, Future Engineering Group, Tasman Power, North West and Flanco all are facing very strong demand for their services, and that's included in that forecast.
Great. Thanks, Stephen. Just on the working capital, just a little bit of a step up in the second half. I know the timing of acquisitions can impact that, but just how should we be thinking about it into FY 2026?
I think, as you know, Megan, it really does depend on timing and what goes on around June 30. We had some significant collections in early July, which helped get that back. You know we will step up and down depending on the time. Overall, the average is we're targeting to stay below net working capital to sales in that 3% - 4% range, which is where we always like to be. We'll continue to try and target that.
Great. Last one, just on the upsized banking facilities, just around that comment, if you could just remind us where you're comfortable taking the leverage to for acquisitions. Thanks.
We have an internal ball target of net debt to EBITDA of circa 1x . That obviously reduces on a monthly basis. If I look at my forecast, that'll be without an acquisition, that'll be down at circa 0.5 x if I don't make an acquisition. We'll step it down and then we'll step it back up along that way. We've got significantly higher buffer margins with our financiers, but we'll continue to prudently ensure that we're protecting our equity as we move forward and our shareholders' equity.
Megan, I think a very important point that Mark just made. We do have all of our wealth tied up in Tasmea . Mark and I are conservative. The reason we're diversified is to mitigate risk and protect our equity. The reason we keep our leverage around 1x is, again, to protect our equity.
That's very clear. Thank you.
Once again, if you wish to ask a question, please press star one on your telephone and wait for your name to be announced. Your next question comes from Joe Gallagher at Morgans. Please go ahead.
Yeah, thanks. Congratulations, Stephen, Mark, Jason, and Trent, for a great result once again. I just want to ask about your exposure, and thanks for the detail in the appendix, but the exposure for, I suppose, the different commodities going forward. You've reduced your exposure to iron ore over the last few years. Looking forward, especially with one of your biggest customers really ramping up their CapEx in that area, do you see that continuing to sort of be diversified, or could we see that exposure increase back up again with that spend increase?
I think if I make a very high-level general comment, when we acquired Tasman Power in 2014, I thought the easiest thing for us to do would be to take their very significant skills out of the Pilbara and grow the business away from the Pilbara. The harder we try and run from the Pilbara, the harder it chases. I suspect it will go up. You have a look at, which I guess some of this is anecdotal, but the new chief executive of Rio Tinto is the previous head of iron ore, Simon Trott. It kind of tells you most probably where Rio think its short-term future is. I think iron ore will remain a strong part of Australia. As I said, Mark and I are focused on protecting our equity. In the event China went into Taiwan, that would be a huge risk for us.
That was one of the reasons why we have diversified. We think we're in a very strong defensive position and a very strong growth position. Just in making that comment, you can see that we think more than where is the next electrical maintenance job coming from.
Charts, Mark here. I might just ask Jason to comment on the customer demand coming from the new proposed mines and capital upgrades in the Pilbara and electrification in a broader sense, and how the group is having lots of different service offerings, seeing lots of opportunities. Jason's in the Pilbara all the time, he's best to answer that.
Thanks, Mark. Yeah, so overall, like what we've sort of touched on previously, our order book is as strong as what we've ever seen, and the inquiries continue to grow. We've obviously built a business around servicing the fixed plant assets, and the industries that we support, iron ore, copper, gold, etc., they're all really harsh on their fixed plant as they process their material. A lot of the assets that we are maintaining are running above the nameplate value that they're designed for. Every year that we're maintaining those assets, they require more maintenance to keep them up. Our clients continue to push for record tons throughout those assets, which are all running above the nameplate values that they're designed for. On top of all of that, they're obviously expanding to get more production out. We've got the electrification as our customers try and achieve their net zero targets.
What that means for us is there's a whole pile of new electrification requirements and electrical infrastructure that we hadn't seen previously. Where diesel generators were running bore pumps, etc., they're now being pulled out and replaced with either overhead power lines or permanent underground power. There's a massive requirement in all of that. We're seeing just a huge opportunity for us, essentially in our own backyard. Just by keeping what we have, all of our existing customers have all got a lot more opportunities for us than what they haven't in previous years.
That's great. Thank you, guys.
Your next question comes from Jonathan Higgins and Unified Capital Partners. Please go ahead.
Hi guys, great set of results. Just wondering if we could potentially, from IPO to today, just sort of reflect on just potentially what services and sort of products and the like the group has, how that sort of fits in today, and if there's any gaps in the wider offering that you sort of look at in terms of geographies or services across the segments and the like that, you know, could be sort of pushed towards in further acquisitions and whether that environment's still as fertile as what it was. Thank you.
Jon, we've said we've got a very strong pipeline for growth. Maybe if I went the other way, the biggest constraint on growth is getting access to skilled labor. We continue to do that successfully by paying top quartile, and we're able to get labor, but often the demand for additional labor is both short-term and at short notice. Access to labor is an issue. Opportunity is everywhere. Jason just mentioned that iron ore will continue to grow as a result of our customers' capital expenditure plans. Electrification, I would have mentioned to complement what Jason said, a number of our large customers got a lot of European capital in their businesses, and they need to have one eye on net zero. No matter what's happening politically here, that electrification trend, in my view, will stay.
If I had a comment about the target, if anything, it's so large, it's unachievable. We see more work than we have capacity there. We have got great opportunities to expand in Queensland, great opportunities to expand in the Northern Territory. Fingers crossed, and I have to say BHP caused me to cross my fingers too many times, but they would appear to be still focused on creating a copper province in South Australia. In our backyard, we're going to have circa $10 billio- $15 billion spent over the next three to five years, which again will be a huge opportunity for us. I think while it still works, we'll be saved. Again, it is an old rusty set of bolts. It's going to have billions spent on it, further opportunities for us, even to just keep the bolts together. Near Star again, further opportunities.
There are lots of marketplace opportunities, but the greatest opportunity is finding those little niche specialist providers, buying them, bolting them onto our family.
Jon, to summarize, yes, we are advanced on a number of exciting opportunities, which will complement the Tasmea service offering and hopefully make us more attractive to providing exceptional services to our customers.
Thanks, guys. Good result.
Once again, if you wish to ask a question, please press star one on your telephone and wait for your name to be announced. Your next question comes from Philip Pepe at Shaw and Partners. Please go ahead.
Hi guys, great result and thanks for taking the question. I think you kind of just answered it in John's last question, but just curious in terms of the stepping stone from the $110 million EBIT you've called out, sorry, $135 million EBIT you've called out to $160 million as an aspiration. You stressed aspiration. I guess you've called out Queensland and Northern Territory, South Australia, so copper, maybe coal, perhaps a bit more iron ore from what you just said earlier. Can you give us a flavor for which segments, which commodities you think will show the greatest growth over the next few years and where you might be increasingly exposed to in the coming 12 months - 24 months, please?
I guess it's a matter of where you start from. Copper most probably is the biggest short-term growth because the expenditure has been there's a lower base. Iron ore will continue to grow, in my view, steadily. As you're aware, we work maintaining an aging fixed plant. The new plant that's been built, not a great opportunity for us. Might do a little bit of civil work around it, but the maintenance comes from the plant once it finishes its warranty period. We get in and maintain that. There'll be growth there. We are having a look. I think it's interesting. We'd stayed away from coal because the banks didn't like it. The equity sector didn't like it. The reality is there's a lot of activity going there, and we most probably can't resist the temptation. It won't become a major part of our business, but it could become 5%.
Excellent. Thank you.
Gold, by the way, is just going gangbusters currently, and Flanco helps us with our exposure to gold.
Excellent. Thank you.
Was there a follow-up, Mr. Pepe?
No, that's all. Thank you very much.
Thank you. There are no further phone questions at this time. I'll now hand back to Mr. Young for closing remarks.
Thank you very much to everyone who participated. Thank you for spending the time with us. We look forward to keeping you appraised. We are on the road next week, and we'll get to see a number of you, I hope. Thank you for your interest, and look forward to catching up face to face if we get the opportunity. Good morning.
That does conclude our conference for today. Thank you for participating. You may now disconnect.