Highlights

  • COSOL enters FY27 focused on converting its $12.8 million Australian rail contract and Canadian REM engagement into Revenue growth after FY26 revenue fell 15.6%.
  • H2 FY26 underlying EBITDA nearly doubled to $6.3 million from $3.4 million in H1, providing the operating platform for the FY27 growth strategy.
  • IBM is expected to represent approximately 45% of FY27 US revenue, up from 25% in FY26, reflecting a deliberate shift toward higher-margin data and digital consulting work.
  • New interim CEO Anthony Stokes takes over from 18 August 2026 as the board searches for a permanent leader to guide the company's next growth phase.

COSOL Limited (ASX:COS) is heading into FY27 with a clear strategic pivot toward revenue growth, following a FY26 in which revenue fell 15.6% to $98.6 million but second-half underlying EBITDA nearly doubled to $6.3 million from $3.4 million in the first half. The technology-enabled asset management and digital consulting provider has used the year to reset its cost base, and management now frames FY27 as the period in which that reset should translate into a return to top-line growth.

The forward outlook rests heavily on converting two newly secured transport contracts -- in Australia and Canada -- alongside a shifting revenue mix toward higher-margin data and digital consulting, even as the company navigates a Leadership transition at the top.

New Contracts Provide the Foundation for FY27 Growth

COSOL's growth outlook centres on two newly secured transport contracts. In Australia, the company has secured a five-year, $12.8 million contract with the consortium developing a major rail project, running through to the end of construction in 2031 and covering digital asset management services, real-time digital intelligence and an option for ongoing maintenance support during the operating phase.

In Canada, COSOL has commenced a multi-year engagement with La Caisse to improve digital asset management across the CDPQ Infra REM rail network in Montreal, including development of a digital twin integrating operational data into a real-time dashboard. Management describes both engagements as examples of its strategy to apply digital asset management capabilities to large transportation infrastructure projects, positioning transport as a key vertical in the company's FY27 growth plans.

Cost Reset Provides an Improved Operating Platform

COSOL's FY27 outlook benefits from an operating cost reset completed during FY26, which lifted operating margins from 28.8% in the first half to 31.2% in the second half even as revenue remained flat over that period. Full-year underlying EBITDA was approximately $9.7 million, with the improved H2 run-rate of $6.3 million representing the base management is looking to build from as revenue growth resumes.

The company ended FY26 with $5.3 million in cash, cash conversion of 108% and net Debt reduced to $20 million, giving COSOL a reasonably stable financial position from which to pursue its FY27 growth strategy, notwithstanding the $6.5 million Goodwill Impairment and $4.02 million statutory net loss recorded during the year.

Data and Digital Consulting Set to Play a Larger Role

COSOL's outlook increasingly depends on its Data and Digital consulting business, which recorded a 37.9% Margin in the second half of FY26, up 340 basis points from the first half. Management is positioning AI-driven Data Analytics and industrial mathematics as central to securing longer-term, higher-margin contracts going forward.

The company's US Business illustrates this shift clearly: IBM, which represented no revenue in FY23, accounted for 25% of revenue in FY26 and is expected by COSOL to reach approximately 45% of FY27 revenue -- a significant change in the composition of the US operation that underpins the company's broader push into data and digital capabilities.

Leadership Transition Coincides With the Growth Pivot

COSOL's forward strategy is being executed amid a leadership change. Managing Director and CEO Scott McGowan stepped down from the CEO role after 10 years, moving into the position of Executive Director Strategy and Solutions, while Chief Operating Officer and CFO Anthony Stokes became interim CEO from 18 August 2026. The board has commenced a search for a permanent CEO, with Chairman Geoff Lewis appointed Executive Chairman during the transition.

Mr McGowan will continue working on COSOL's solutions strategy, while Mr Stokes oversees the business during the interim period -- a structure management appears to view as compatible with maintaining momentum on the FY27 growth pivot while the permanent leadership search proceeds.

Conclusion

COSOL's outlook for FY27 is built around converting a reset cost base and newly secured transport contracts in Australia and Canada into a return to revenue growth, after a FY26 in which the Top Line declined 15.6% even as second-half profitability improved sharply. The growing contribution from IBM and the broader data and digital consulting business adds a further structural growth lever, while the leadership transition to interim CEO Anthony Stokes introduces some near-term uncertainty. The key test for COSOL's FY27 outlook will be whether the H2 profitability improvement can now be matched by a genuine recovery in revenue growth.