Highlights

  • FY26 gross Revenue reached A$4.37 billion, while underlying EBIT increased to A$470.2 million and underlying NPAT rose to A$223.1 million.
  • Solid Waste Services remained the main Earnings contributor, with EBIT of A$405.0 million and a 16.2% margin.
  • Net Debt increased to A$2.29 billion, lifting Leverage to 2.27 times after Acquisition funding.
  • FY27 underlying EBIT guidance is A$500 million to A$530 million.
  • A non-binding acquisition proposal adds uncertainty alongside operational execution risks.

Cleanaway Waste Management Limited (ASX:CWY) is an integrated waste management company operating across collection, recycling, landfill, health services and industrial services. Its FY26 result showed higher underlying earnings and free cash flow, alongside rising debt and softer performance in Environmental and Technical Solutions.

FY26 Earnings Increased, While Statutory Profit Was Lower

Gross revenue rose 13.5% to A$4,371.3 million and underlying EBIT increased 14.2% to A$470.2 million. Underlying net profit after tax reached A$223.1 million, equivalent to 10.0 cents per share. Free Cash Flow increased to A$213.8 million, while the full-year Dividend was 6.85 cents per share, fully franked.

Statutory net profit was A$98.5 million after A$124.6 million of significant items. These included a A$44.4 million Impairment associated with the closure of the construction and demolition Business and a write-down of the Circular Plastics Australia investment.

Solid Waste Services Remained the Core Earnings Base

Solid Waste Services generated net revenue of A$2,506.4 million and EBIT of A$405.0 million, with a 16.2% margin. Health and industrial services were softer due to lower customer pricing, a Facility outage, delayed commissioning, fewer industrial shutdowns and project deferrals. These issues remain central to the FY27 recovery task.

Contract Resources contributed A$319.8 million of revenue and A$36.1 million of EBIT over eleven months. Its contribution supported industrial services earnings, although much of the growth was acquisition-led rather than organic.

Debt and Capital Requirements Remain Important

Net debt rose to A$2,288.7 million and leverage increased to 2.27 times. FY27 also carries expected cash commitments including about A$360 million of Capital Expenditure and around A$140 million of cash interest. Landfill remediation spending of approximately A$180 million is expected across FY27 to FY29.

FY27 Guidance Points to Further EBIT Growth

Management guided to FY27 underlying EBIT of A$500 million to A$530 million. The outlook assumes growth in collections, recovery in health and industrial services and further contribution from Contract Resources, partly offset by higher technology and transformation costs.

Proposal Status Adds a Separate Source of Uncertainty

During 2026, Cleanaway received a non-binding indicative acquisition proposal at A$3.13 per share, subject to due diligence, board support and regulatory approvals. The supplied material indicates discussions were continuing in September 2026 and no binding transaction had been established at that point.

Key Risks and Watch Points

Key risks include the pace of recovery in health and industrial services, leverage and interest costs, Contract Resources integration, landfill remediation commitments and delivery against the FY27 EBIT range. The status of the non-binding proposal is another watch point, but operating performance remains relevant regardless of whether a transaction proceeds.

Key Insights

Cleanaway entered FY27 with a larger earnings base and higher free cash flow, but also higher leverage and several operational areas requiring improvement. Solid Waste Services remains the core earnings engine, while the FY27 outcome depends on recovery initiatives, acquired capacity and capital discipline. The proposal adds uncertainty, but the underlying focus remains execution and cash generation.