Key takeaways

  • EVZ lodged its Appendix 4C for the June 2026 quarter before the market opened on 28 July, reporting a A$2.4 million net operating cash outflow for the quarter against A$10.1 million of positive operating cash flow for the full year.
  • Closing cash was A$18.3 million with no drawn debt and A$27.4 million of available funding capacity, while contract backlog was again quoted at roughly A$80 million, unchanged across three quarters.
  • May 2026 guidance pointed to FY26 revenue of A$120 million to A$125 million and EBITDA of A$8.5 million to A$9.0 million, with audited results due in the week beginning 24 August 2026.

EVZ Limited (ASX:EVZ) sits at the smaller end of the Australian industrial market and is unusual among microcaps for one reason: it trades profitably and has resumed paying a dividend. Before the open on 28 July 2026, EVZ lodged its Appendix 4C and quarterly activities report for the three months to 30 June, closing a year in which management had already lifted earnings expectations. It carried a price-sensitive flag.

Latest announcement or development

The June-quarter report is the obvious focal point. EVZ recorded a net operating cash outflow of A$2.4 million for the quarter, against positive operating cash flow of A$10.1 million for the full year. Customer receipts were A$29 million in the quarter and A$142 million for the year, up 18 per cent. Management put part of the outflow down to timing, with about A$1.5 million of expected receipts landing after 30 June.

Recent financial and operational performance

On 7 May 2026 EVZ guided to FY26 revenue of A$120 million to A$125 million and EBITDA of A$8.5 million to A$9.0 million, against FY25 revenue of about A$108 million and EBITDA of A$5.3 million. Management attributed the step-up to operational improvements across the group rather than one contract.

The first half did much of the work: revenue of about A$63 million and EBITDA of A$4.4 million for the six months to 31 December 2025, a net profit of roughly A$2.0 million, and a fully franked interim dividend of 0.5 cents per share. The June quarter shows A$608,000 of dividends paid.

Business model and principal assets

EVZ is a holding company for four operating businesses across two segments. In Energy and Resources, Brockman Engineering designs, builds and maintains bulk fuel and process storage tanks, while TSF Power supplies technical and power-related services. In Building Products, Syfon Systems installs siphonic roof drainage in Australia and South-East Asia, and Tank Industries fabricates steel tanks for water and industrial customers.

The economics are a contractor's, not a manufacturer's. Revenue is won project by project, margins hinge on tendering discipline and execution, and little fixed capital is tied up. Capital expenditure of A$128,000 in the June quarter shows how asset-light it is.

Growth opportunities

Management points to Australia's onshore fuel storage build-out as the clearest demand driver, citing a A$10.2 billion Federal Government funding package. Brockman has worked on terminal expansion and refinery scopes, and earlier awards included tank packages for a fuel terminal and a rare earths refinery.

Building Products runs on different drivers. Tank Industries reported a material uplift in revenue from larger projects including data centre work, and Syfon's Asian arm is supported by regional infrastructure spending. The company also describes an active acquisition pipeline, though no transaction has been announced and none should be assumed.

Balance sheet, funding and cash flow

The funding position looks comfortable for a business of this size: A$18.3 million of cash at year end, no drawn debt, and A$27.4 million of available capacity including undrawn facilities. In April 2026 the group moved its banking from Commonwealth Bank to HSBC Bank Australia under a A$15.5 million package built around a A$10 million guarantee and standby line.

For a contractor, bonding capacity can matter as much as cash, because it determines which tenders can credibly be bid. Full-year operating cash flow of A$10.1 million against guided EBITDA points to sound conversion, with the June quarter an exception.

Principal risks

Contracting risk sits at the top. Fixed-price work exposes margins to labour availability, subcontractor pricing and steel costs, and at this size one badly bid project can absorb a meaningful share of group earnings. A backlog held near A$80 million across three consecutive quarters also raises a fair question about replacement rates.