VEEM FY26 slides: transition year shows H2 recovery momentum

VEEM Limited (ASX: VEE) reported financial results for FY26 on August 27, 2026, describing the year as a transition period with a notable H2 recovery. The company's FY26 revenue of $51.7 million, down 25% from the prior year's $68.6 million, fell within the expected $50-52 million range. Despite these challenges, VEEM met its revised guidance, reassuring investors. The stock closed at $0.56, down 1.75% from the previous close.

The second half of FY26 showed a clear recovery, with revenue reaching $28.3 million, up 21% from the first half's $23.4 million. EBITDA also improved, turning from a $0.2 million loss in the first half to a $3.8 million profit in the second half. However, overall profitability declined, with EBITDA for FY26 at $3.6 million, down 61% from the prior year's $9.2 million. This was primarily due to lower gyrostabiliser sales, delayed defence orders, and development costs for new product launches.

VEEM's financial health improved significantly despite the profitability challenges. Operating cash flow rose by 66% to $4.8 million, driven by deliveries under the Australian Submarine Corporation contract and increased propeller orders. The company's balance sheet strengthened following a capital raise that generated $13.1 million in net proceeds, reducing net debt by $12.5 million to $1.2 million, and increasing cash on hand to $9.4 million.