Veris Limited

Income statement

Sources and notes:

Revenue: FY23 Results (FY22, FY23), FY25 Results (FY24, FY25), FY26 Results (FY26).

Gross profit: derived from gross margins of 32.6% (FY24) and 36.5% (FY25) (MST Access, Sep 2025; AGM 2025 presentation).

EBITDA: FY24 and FY25 adjusted and reported EBITDA from Veritas Securities (29 Oct 2025), consistent with FY25 Appendix 4E (adjusted A$10.1m versus A$6.8m). The FY25 media release headline uses A$10.0m.

Statutory EBIT: FY25 and FY26 from FY26 Results. FY22–FY24 are TipRanks "operating income" (aggregator).

Underlying PBT: FY22–FY23 derived from underlying PBT margins of 0.1% and 1.0% in the FY26 Results Presentation chart. FY24 from FY24 Results (underlying loss A$1.8m). FY25–FY26 from FY26 Results.

Statutory PBT: FY22–FY23 TipRanks (A$0.105m, A$0.992m). FY24–FY26 company.

NPAT: FY23 TipRanks (A$0.892m). FY24 company (A$4.7m loss). FY25 Appendix 4E (A$1.95m). FY26 Quartr summary (A$0.639m, −67%).

EPS: derived from NPAT ÷ ~520–543m weighted shares.

• FY25 0.2c fully franked (A$1.053m). FY26 nil (Appendix 4E).

Margins

Revenue CAGR (derived): FY22–FY26 is +2.5% per year (A$92.4m to A$102.0m). FY23–FY26 is +0.4% per year. The group has essentially recycled the FY23 revenue peak while radically changing mix.

Balance sheet

Sources: FY25 and FY26 balance sheet lines from the FY26 Results Presentation. FY24 cash from Business News Australia (A$16.1m at 30 Jun 2024). FY24 net cash and equity from Veritas Securities (29 Oct 2025); FY25 net cash also Veritas. FY26 net cash is company-stated (FY26 Results Presentation). Interim reference: total equity A$28.3m and cash A$16.7m at 31 Dec 2023 (Google Finance). Goodwill and intangibles are not separately disclosed in the presentation; the "DTA, intangibles, other" line is used instead. A short/long-term debt split is n/d in the data retrieved.

Additional balance-sheet facts at 30 Jun 2026 (FY26 Results Presentation):

• Franking credits: A$5.4m.

• Carry-forward unrecognised tax losses: A$11.4m.

Cash flow

Notes:

• FY23 OCF of A$8.9m (+68%) is from FY23 Results; FY22 (A$5.3m) is derived from the +68%.

• FY26 OCF of A$8.1m is from the FY26 Results Presentation.

• The FY24 dividend line reflects the FY23 final dividend paid Nov 2023 (H1 FY24 Results).

• FY26 dividends reflect the FY25 final dividend of A$1.053m, with the DRP applied at 7.0c (H1 FY26 Appendix 4D).

• Spatial Vision upfront cash was A$1.5m (30 Jan 2025 release).

• Capex, free cash flow and buy-back dollars by year are n/d in the material retrieved.

• The FY26 cash bridge (A$16.6m to A$13.3m) shows +A$8.1m operating inflow, offset by outflows of roughly A$2.0m, A$1.0m, A$7.5m and A$1.0m. Per the FY26 announcement, these cover the Mesh/Mesh-Dash consideration, the FY25 dividend, buy-back, lease/capex and non-recurring M&A, restructuring and systems costs. Exact line labels were not captured.

Ratios (derived unless stated)

Method notes:

• ROE uses average equity (FY25: 1.95 ÷ avg(23.0, 26.1)). ROA uses closing assets for FY25 and average assets for FY26.

• Net finance cost is implied as EBIT − PBT (FY25 A$0.5m; FY26 A$0.8m) and is predominantly lease interest.

• Negative net debt/EBITDA indicates net cash.

• Debtors and WIP of A$21.7m on A$102m revenue imply ~78 days of revenue in receivables and WIP (FY26, derived).

• The current ratio is n/d because the current/non-current split of employee benefits and borrowings was not captured.

Commentary on trends, inflections and drivers

FY22 (reset year). The sale of Aqura to Telstra Purple for A$30m (settled Feb 2022) turned Veris from a leveraged two-division group into a debt-free surveying business. Continuing revenue was A$92.4m with roughly breakeven underlying PBT. The disposal crystallised value equal to almost the entire pre-deal market capitalisation, which says a great deal about how the market valued the residual surveying business.

FY23 (volume peak). Revenue rose 9.2% to a record A$100.9m and operating cash flow jumped 68% to A$8.9m, helped by a Key Account Management program focused on national clients. Underlying PBT margin was only ~1.0%, however. Volume was not translating into earnings, which set up the FY24 pivot.

FY24 (deliberate contraction and restructure). Revenue fell 8% to A$92.6m as management exited smaller, low-margin projects (H1 FY24 revenue −8% to A$48.3m). About 100 roles were removed and a national operating model replaced the regional structure. Underlying loss before tax was A$1.8m; statutory PBT was −A$4.4m after ~A$3.0m of restructuring and one-off costs (MST Access). The balance sheet absorbed the restructuring with cash broadly stable at A$16.1m.

FY25 (margin inflection). Revenue grew 5% to A$97.2m on 27% fewer projects (MST Access). Gross margin expanded ~390bp to 36.5% and adjusted EBITDA rose 49% to A$10.1m (10.3% margin). Statutory PBT returned to +A$2.0m and a 0.2c fully franked dividend was reinstated. Spatial Vision (~A$9m revenue) was acquired in H2.

FY26 (mix progress, macro drag). Revenue crossed A$100m (A$102.0m, +4.9%), aided by a full year of Spatial Vision and seven months of Mesh. Underlying EBITDA edged up to A$10.3m. Underlying PBT slipped to A$2.2m (2.2% margin) and statutory PBT fell to A$0.6m after A$1.6m of one-offs: M&A costs, ERP/project-system assessment, acquisition amortisation, office relocation and restructuring. Management describes the year as having two conflicting themes. Strong D&S and C&A growth (D&S 28% of revenue) was offset by weaker traditional cadastral and engineering survey markets, notably in Victoria and Tasmania, against softer state property markets, rising interest rates and geopolitical conflict. H1 was strong (revenue +9% to A$50.8m; underlying PBT +69% to A$1.7m). The implied H2 was materially weaker: H2 revenue ~A$51.2m and underlying PBT ~A$0.5m (derived). This H2 deterioration is the key analytical concern going into FY27.

Quality-of-earnings observations.

1. The gap between underlying EBITDA (~10%) and statutory PBT (~0.6–2%) is wide. It is driven by ~A$7–8m of D&A, most of it AASB 16 right-of-use lease depreciation and survey-equipment depreciation (MST forecast FY25 D&A of A$7.4m), plus recurring "one-offs" in three consecutive years (FY24 restructure, FY25 ~A$0.6m, FY26 A$1.6m).

2. EBITDA flatters the business relative to pre-AASB 16 metrics, because lease payments sit below EBITDA.

3. Cash generation is better than reported earnings. OCF of A$8.1m against NPAT of A$0.6m reflects D&A add-backs and working-capital discipline.

Management guidance

No quantitative FY27 guidance has been given. Management points to:

• a secured forward workload of A$65m and a weighted pipeline above A$195m;

• Spatial Vision and Mesh integrations being well progressed;

• the Octave channel adding recurring revenue;

• continued disciplined cost and capital management.

It describes the pipeline and contracted order book as at historically strong levels despite macro headwinds (FY26 Results, 26 Aug 2026).

Consensus

No independent consensus exists. Sponsored forecasts made before the FY26 result (Veritas FY27E revenue A$115.9m, EBITDA A$13.0m) look stretched relative to FY26 actuals and are likely to be revised.

Bull case

1. Mix-driven margin expansion resumes. D&S rose 11 percentage points of revenue share in three years. If D&S and C&A reach ~40% of revenue on a cost base already right-sized in FY24, underlying PBT margins could return to the ~3.3% achieved in H1 FY26. On A$105–110m revenue, that is ~A$3.5m PBT, sheltered by A$11.4m of tax losses.

2. The valuation floor is the balance sheet. At ~A$25m market capitalisation, ~0.9x book and ~45% of market cap in net cash, the market is ascribing only ~A$14m EV to a business producing ~A$10m of underlying EBITDA and ~A$8m of operating cash flow. A buy-back at these levels is accretive.

3. Recurring revenue optionality. Octave (A$1.2m initial base, access to Hexagon's installed base), Parsel subscriptions and app-development managed services could compound into a recurring-revenue segment that warrants a separate valuation.

Bear case

1. Structural low-margin trap. Despite a 49% EBITDA rebound in FY25, statutory PBT has not exceeded A$2.0m in five years. Recurring "one-offs" show that underlying earnings systematically overstate cash-adjusted profitability after lease costs.

2. Momentum reversal in H2 FY26. H1 underlying PBT was A$1.7m against an implied H2 of ~A$0.5m. Survey markets in VIC and TAS weakened, and further rate pressure or state budget cuts could push FY27 towards breakeven.

3. Scale and competition. Acquisitions of ≤A$3m add capability but not scale. The majors (WSP, Stantec, Arcadis, Jacobs) and Esri's GIS channel dominance cap Veris' pricing power in digital and software, and the dividend suspension signals board caution.

Catalysts and monitorables (next 12 months)

Analyst verdict

Veris is a credible but unfinished turnaround. Since the 2022 Aqura divestment, management has done most things a capital-constrained micro-cap can do. It removed bank debt, restructured to a national operating model, culled low-margin work and nearly tripled the Digital & Spatial share of revenue to 28%. It also assembled a coherent ladder of higher-value services: survey data, then proprietary platforms, then GIS applications, then advisory, then software distribution. Three small, earn-out-protected acquisitions (Spatial Vision, Mesh, Mesh-Dash) and the Octave distributorship are sensible, low-risk building blocks. The DTV consortium leadership gives the company real government credibility.

What has not followed is earnings. Five years after the reset, revenue is only A$1m above the FY23 peak, and statutory PBT has never exceeded A$2.0m. FY26 underlying EBITDA of A$10.3m looks healthy but is heavily flattered by AASB 16. Below the line, recurring "one-off" costs and lease and equipment depreciation leave a statutory PBT margin of just 0.6%. The sharp deterioration from H1 to H2 FY26 and the suspension of the dividend suggest the traditional survey base remains a drag that mix-shift has not yet overcome.

Valuation is the strongest part of the argument. At roughly 0.9x book, ~0.13x EV/sales and with nearly half the market capitalisation in net cash, the market is pricing Veris as an ex-growth surveying contractor and assigning little value to the digital portfolio. For the stock to re-rate, Veris needs two to three consecutive halves of statutory PBT margins sustainably above 3%, with no fresh one-offs, alongside evidence that Octave and the platform portfolio are building measurable recurring revenue.

The H1 FY27 result is the decisive test of whether the FY26 slowdown was cyclical or structural.