Key Highlights

  • Lindsay Australia (ASX:LAU) reported record FY26 Revenue of $1.073 billion, an increase of 26.2% and the first time annual revenue exceeded $1 billion.
  • Underlying EBIT increased 37.7% to $60.4 million, while reported NPAT rose 31.5% to $22.9 million.
  • Transport revenue increased 32.9% to $762.9 million, supported by the first full-year contribution from SRT Logistics.
  • The company secured a five-year Primary Connect contract expected to generate annual revenue of approximately $30 million to $36 million from a North Queensland secondary freight operation.

Lindsay Australia Limited (ASX:LAU) delivered record financial results for FY26, with Group revenue exceeding $1 billion for the first time. Revenue increased 26.2% to $1.073 billion for the year ended 30 June 2026, supported by the first full-year contribution from SRT Logistics and organic growth across the Transport and Rural businesses.

Underlying EBITDA increased 25.6% to $127.8 million, while underlying EBIT rose 37.7% to $60.4 million. Reported NPAT increased 31.5% to $22.9 million. Underlying EPS rose 10.0% to 7.6 cents on a post-AASB 16 basis.

The Earnings improvement was achieved despite subdued trading conditions. Lindsay attributed the result to its diversified operating model, Investment in fleet and facilities, targeted acquisitions and ongoing benefits from its transformation program.

Transport Drives Group Earnings Growth

Transport remained the largest contributor to Group revenue, with sales increasing 32.9% to $762.9 million. The result reflects a full twelve months of SRT Logistics within the Group.

Transport underlying EBIT increased 25.9% to $77.4 million. Tasmania now accounts for 19% of Transport revenue, while the Business has also expanded into Southwest Western Australia and opened a purpose-built Facility in Perth.

The company continued to increase its use of High Productivity Vehicles. Twenty-five additional combinations were added during FY26, with HPVs accounting for more than 13% of road kilometres travelled. The transition is intended to improve utilisation while addressing Margin effects arising from market conditions.

The integration of SRT Logistics has now been completed, with Lindsay reporting that its EPS accretion targets have been delivered.

Rural and W.B. Hunter Deliver Higher Earnings

The Rural division recorded revenue growth of 15.3% to $190.8 million. Growth was broad based across cartons, fertilisers and nutrients, while expansion into Southwest Western Australia continued.

Underlying Rural EBIT increased 22.8% to $12.2 million. The division's EBIT margin improved from 6.0% to 6.4%, indicating that earnings growth exceeded revenue growth during the period.

W.B. Hunter revenue increased 7.9% to $118.9 million, while underlying EBIT rose 11.3% to $3.2 million. Pet and produce, fertiliser and carton sales contributed to the result, with the Nagambie and Seymour stores now fully integrated.

Primary Connect Contract Opens Secondary Freight Market

Lindsay has secured a five-year transport services contract through Primary Connect covering approximately 40 Woolworths stores between Mackay and Cairns in North Queensland.

The contract is expected to generate annual revenue of approximately $30 million to $36 million once fully implemented. Operations will begin progressively from October 2026, with full implementation expected by July 2027. FY27 will therefore include only a partial year of revenue, with the full run rate expected from FY28.

The project includes approximately $20 million of dedicated Capital Investment and two new greenfield sites in Townsville and Cairns. Lindsay expects the contract to generate returns above its internal 15% ROIC hurdle rate.

The agreement represents the company's first scaled position in the mainland secondary freight market and extends its transport network into an additional freight segment.

Capital Investment and Leverage

Lindsay invested $40.5 million in capital during FY26, within the revised target range of $40 million to $45 million. Investment focused on fleet and infrastructure, with capital efficiency supported by equipment redeployment, network synergies and improved fleet utilisation.

FY27 capital investment is expected to increase to approximately $57 million, including the $20 million associated with the Primary Connect contract. The major property program is largely complete following approximately $20 million of investment over the past five years.

Net Leverage finished FY26 at 1.92 times, down from 2.23 times at the half-year and within the company's target range of 1.0 to 2.0 times. Lindsay is targeting leverage of approximately 1.8 times by 30 June 2027, although leverage may temporarily exceed the upper end of the range during the first half because of the timing of growth capital expenditure.

Cash Flow, Returns and Dividend

Operating Cash Flow was $75.2 million, equivalent to normalised cash conversion of 74% after adjusting for the timing of prior-period tax payments. This compares with a five-year average of 70%.

Return on invested capital was 13.9%, compared with 14.3% in FY25 and 12.6% at the FY26 half year. The company reported invested capital of $399.5 million.

The Board declared a fully franked final Dividend of 1.7 cents per share, taking the FY26 total dividend to 3.8 cents per share. The full-year dividend was unchanged from FY25 and represented a statutory Payout Ratio of 60.7%.

FY27 Outlook

Lindsay expects refrigerated transport conditions to remain competitive, with consumer Demand continuing to constrain volumes. The company expects growth to come from Market Share gains and expansion into secondary freight.

Rural conditions are expected to remain favourable, although lower biennial avocado and citrus volumes in Western Australia and Central Queensland are expected to affect some markets. These effects are anticipated to be offset by expansion in Tasmania and other regions.

With the major network development program largely complete, management's focus is shifting toward asset utilisation, integration, margin improvement and extracting greater value from the expanded network.

Conclusion

Lindsay Australia's FY26 results show a substantial increase in both scale and earnings, with revenue exceeding $1 billion and underlying EBIT rising 37.7%. Transport provided the largest contribution to growth following the full-year inclusion of SRT Logistics, while Rural and W.B. Hunter also delivered higher earnings. Capital investment remained controlled and leverage improved from the half-year, although FY27 investment will increase because of the Primary Connect contract. The unchanged annual dividend indicates that Shareholder distributions remained stable despite the expansion program. The company's FY27 performance will depend on utilisation of its enlarged network, continued margin improvement and the progressive contribution from secondary freight.