IPD Group (ASX:IPG) management said the company delivered a record first-half performance for FY26, with revenue and earnings exceeding the top end of guidance provided in November 2025, supported by ongoing growth in its core distribution operations and strong demand from infrastructure-linked end markets including data centers, mining, and water.
Record first-half result beats guidance
CEO Michael Sainsbury said the group reported “continued growth exceeding the top end of our guidance,” while CFO Jason Boschetti described the period as “another record performance” for the half year ended 31 December 2025. The company reported revenue of A$192.7 million, up 8.9% versus the prior comparative period, with underlying EBITDA of A$25.4 million, up 7.6%. Underlying net profit after tax was A$14.4 million, up 8.3%, and underlying EPS was A$0.138, up 7%.
Operating cash flow/free cash flow was cited as A$17.1 million by Sainsbury. Boschetti added that operating free cash flow (defined as operating cash flow before interest and tax) was 67.5% for the first half, impacted by increased working capital investment, while the 12-month rolling operating cash flow conversion was 92.2% for calendar 2025.
Business unit performance and end-market exposure
Boschetti said revenue growth was broad-based across the portfolio, led by the core IPD business (up 11%), with CMI up 2% and EX Engineering up 55%. He said the group continued to see growth in infrastructure sectors including data centers, infrastructure, industrial, mining, and water and wastewater, with combined revenue from those sectors up 13% on the prior period.
Data center revenue rose 16% in the half. Management noted one large data center order expected to be delivered in December 2025 was rescheduled to January 2026; Boschetti said that if it had landed in December, data center revenue growth would have been “approximately 25%” year-over-year. During Q&A, Sainsbury clarified that A$32.8 million was the dollar value of data center revenue in the half after earlier referencing “32.8” in error.
Within CMI, Boschetti said cable revenue was marginally lower versus the prior comparative period (down 0.5%), but up 7.1% compared with the second half of FY25, while “Minto plugs” were up 11% year-over-year. CMI’s EBIT increased 8.1% on the prior period, and the business ended the half with what management described as a solid order book expected to support second-half growth.
EX Engineering’s 55% growth was partly driven by an oil and gas cable supply contract; excluding that contract, Boschetti said EX Engineering revenue would have increased 23% year-over-year. Management also discussed internal cross-selling initiatives, including changing a cable specification at an oil and gas site so that future demand would be filled with CMI cable rather than a competitor’s product.
Platinum Cables acquisition, balance sheet, and dividend
The company completed the acquisition of Platinum Cables on 31 December 2025. Boschetti said the acquisition was predominantly funded via A$37.5 million of new debt. At 31 December, net debt was A$24.4 million, comprising A$48.6 million in combined debt and A$24.2 million of cash.
Management said Platinum did not contribute profit in the first half because the transaction closed on the final day of the reporting period. Boschetti also noted a contingent cash payment of A$7.5 million tied to “a 5x multiple on EBIT growth” for the period ending 31 December 2026.
Net working capital was A$88.9 million, with inventory increasing A$20 million versus 30 June 2025. Boschetti said A$12.6 million of the inventory increase came from the Platinum Cables acquisition and A$7.4 million was procured by IPD to support current projects and future growth.
The board declared a fully franked interim dividend of A$0.068 per share, equating to a payout of A$7.1 million and a payout ratio of 50%, according to Boschetti.
Demand drivers: data centers, water, and mining electrification
Sainsbury highlighted three sectors he said present significant opportunities for the group: water and wastewater, data centers, and mining and resources. He cited an estimate from Sydney Water that data centers could add between 15 and 2035 (as stated on the call) due to cooling requirements, and said data centers could account for 35% of non-residential drinking water demand—linking data center buildouts to water infrastructure needs. He also pointed to A$8.9 billion committed to the National Water Grid Fund backing more than 180 projects across Australia.
On data centers, Sainsbury said Australia had become “world number two behind the US” in terms of investment, and that the projected pipeline had risen from roughly A$26 billion to A$52 billion over the prior six months, calling it a “massive opportunity.” He emphasized products such as bus duct (as a replacement for cable in certain data center “white spaces”), as well as power switchboard systems, cable, and energy management solutions.
Mining and resources were described as increasingly important following the Platinum acquisition. Sainsbury said electrification trends—including battery storage, microgrids, and electric fleets—were driving demand for electrical infrastructure upgrades. He also pointed to the role of mining in supplying raw materials such as copper used in cables and energy storage, linking that demand back to data center expansion.
Pricing, margins, and visibility into data center orders
In response to an analyst question on currency and margin, Sainsbury said the company has a “robust hedging strategy” and noted that it takes time for currency moves to flow through inventory and reported results. He said the business has an ability to manage pricing given hedging and what he described as a natural hedge in its stock profile.
On pricing and commodity volatility, Sainsbury said a large portion of the cable portfolio now has quotes valid for only 24 hours due to copper price fluctuations, versus prior practice of holding quotes valid for about a month. He said the company typically holds “3 to 4 months worth of stock on hand,” with additional supply on order, and that price increases in commodities may take “materially” about six months to flow through. He also said the company implemented a pricing increase of “just over 4%” on 1 March, with additional targeted price actions expected for areas most affected by commodity pricing.
Asked about data center visibility, Sainsbury said bus duct opportunities can be visible around 12 months out due to customization and early engineering work, while switchgear and switchboard systems may be closer to six months. He added that the strategic sales function had identified about A$350 million of opportunity not yet in the formal quotation pipeline, with a significant portion expected to relate to data centers.
On services performance at Adelec, Sainsbury said technician utilization initiatives had increased utilization by an average of 20% versus last year, and he expressed confidence that changes underway—particularly a greater focus on calibration work—would improve profitability, although he noted ongoing delays in reaching a complete design for the Kingsgrove bus depot project.
Looking ahead, management said January and February trading showed positive momentum, and the company entered the second half with a “healthy order book” and a “well-qualified opportunity pipeline,” which Sainsbury said supported confidence in sustained revenue and earnings growth.
About IPD Group (ASX:IPG)
IPD Group Limited distributes electrical infrastructure in Australia. It operates through Products Division and Services Division segments. The company offers power distribution; industrial and motor control; automation and industrial communication; power monitoring; electrical cables; manufacture and distribution of cable plugs; and hazardous area equipment under the third-party brands, such as ABB, Elsteel, Emerson, Red Lion, GE, Socomec, and DEHN. It also offers installation and commissioning; calibration and testing; maintenance and repairs; electric vehicle solutions; and refurbishment and other services.
