Why Equipment Utilisation Matters for Industrials Emeco (ASX:EHL) and Boom Logistics (ASX:BOL) Beyond the S&P/ASX 200

What happens to an equipment hire Business when its machines sit idle for a few extra weeks? Emeco Holdings (ASX:EHL) found out in the second half of FY26, when a prolonged Queensland wet season and slower customer decisions pulled its average surface fleet utilisation down to 82 per cent for the year.

Boom Logistics (ASX:BOL) reported asset utilisation steady at 86 per cent. Both companies rent heavy equipment to resource and industrial customers and both sit outside the S&P/ASX 200, which makes utilisation, the share of available fleet time that is earning revenue, the clearest single lens for comparing them.

Emeco's Mining fleet and the second-half slowdown

Emeco describes itself as Australia's largest provider of mining rental equipment. Its FY26 results presentation, released on 20 August, lists 840 items: 723 open-cut machines such as trucks, dozers and excavators, and 117 underground loaders, trucks and drills.

Gold accounted for 33 per cent of customer exposure, metallurgical coal 30 per cent and iron ore 19 per cent, with copper and thermal coal making up most of the rest.

For the year to 30 June 2026, the results announcement reported Revenue of A$792.8 million, up 1 per cent. Operating EBITDA (earnings before interest, tax, Depreciation and amortisation) fell 3 per cent to $292.5 million, while operating net profit rose 5 per cent to $89.0 million and statutory net profit was $76.7 million.

Rental revenue grew 4 per cent to $637.0 million, helped by a 44 per cent rise in on-site maintenance work. Its Force workshops business generated total revenue of $276.8 million, including $121.0 million of internal work on Emeco's fleet.

Surface utilisation averaged 82 per cent and underground 67 per cent. The presentation attributed the weaker second half to the Queensland wet season, Supply chain challenges and fuel price uncertainty, which delayed fleet redeployment.

Emeco's Capital returns and FY27 targets

Return on capital (ROC), operating Earnings relative to the capital employed in the business, edged up to 16.9 per cent. Adjusted operating free Cash Flow was $114.5 million, and net Debt was $127.1 million, giving Leverage of 0.43 times, below the company's 0.5 to 1.0 times target range, with about $315 million of available liquidity.

The results did not mention a dividend; instead, the board approved an on-market buy-back of up to 10 per cent of shares, or 51.8 million shares, over 12 months. Daily buy-back notices on the company's ASX announcements page show purchases under way through September, and Moody's affirmed Emeco's Credit rating on 17 September.

Management expects FY27 earnings in line with FY26, weighted to the second half, with utilisation lifting to about 90 per cent for surface and 80 per cent for underground by the end of FY27. It is targeting a 20 per cent ROC and plans net Capital Expenditure of $155 million to $165 million.

Boom's cranes and contracted work

Boom hires cranes, from 20 to 800 tonnes, and travel towers, usually with operators, to resources, infrastructure, renewable energy and industrial customers. Its FY26 investor presentation lists about 295 assets, with resources providing 55 per cent of revenue, infrastructure 20 per cent, renewables 16 per cent and industrials 9 per cent.

The FY26 results release, issued on 19 August for the year to 30 June 2026, showed revenue up 2.4 per cent to $271.0 million and underlying EBITDA up 6.6 per cent to $53.3 million. Underlying net profit rose 37.6 per cent to $12.8 million.

Statutory net profit fell 52.8 per cent to $11.0 million. Boom said this reflected one-off impacts from "the Clarke Creek incident, recovery of misused funds and loss on sale of assets", while FY25 had benefited from a material tax credit.

Cash generation improved. Operating Cash Flow rose to $52.8 million from $37.1 million, net capital expenditure fell 33.7 per cent to $16.7 million and the weighted average fleet age improved to 5.9 years. Return on net Assets rose to 9 per cent from 7 per cent.

The company renewed its BHP Olympic Dam contract, which it expects to generate about $40 million a year over the initial five-year term. It declared an unfranked Dividend of 2.25 cents a share, payable on 30 September, and bought back $7.0 million of shares during FY26, with a further program of up to $7.0 million planned.

Utilisation, margins and debt side by side

The two utilisation figures are not directly comparable. Emeco reports average surface and underground fleet utilisation separately, while Boom quotes a single asset utilisation rate, and neither defines its measure in detail.

Margins and debt give a clearer comparison. By our calculation, Emeco's operating EBIT (earnings before interest and tax) of $148.0 million equals about 18.7 per cent of revenue, while Boom's EBIT of $18.6 million equals about 6.9 per cent. Boom reports labour efficiency alongside utilisation, reflecting a larger labour component in crane hire.

Boom's ratio divides net debt by underlying EBITDA. Its net gearing was 39.5 per cent, down from 42.5 per cent. Emeco's figure is the Leverage Ratio the company reports.

Different pressures on each fleet

Emeco's risks centre on Commodity cycles and on redeploying idle machines quickly. Metallurgical coal and gold together account for close to two-thirds of its exposure, and weather or mine-plan changes can leave expensive machines idle, as the second half of FY26 showed.

Boom's risks relate to contract concentration and safety. A large contract such as Olympic Dam supports revenue but raises reliance on one customer, and the FY26 statutory result showed how incidents and one-off items can reduce reported profit. Higher relative debt also leaves less room if work slows.

Dates and signals ahead

Emeco's Annual General Meeting has been moved to 19 November 2026 in Sydney. Boom's annual general meeting is set for 20 November 2026.

For Emeco, the key signal is whether surface utilisation recovers towards 90 per cent. For Boom, watch whether utilisation holds near 86 per cent as the renewed Olympic Dam work continues, and whether the company delivers the Earnings Per Share growth it has budgeted for FY27.