SYNECTICS PLC - Interim Results

Synectics PLC’s H1 2026 investor update highlights a period of transition as the Group progresses its 5P transformation strategy, with management focused on building a more scalable, product- and partner-led business model. Revenue declined to £22.2m from £35.0m, reflecting the non-repeat of a significant prior-year casino project and delays to oil and gas orders linked to Middle East disruption. Despite lower revenue, gross margin improved significantly to 47.8%, while adjusted EBITDA was £1.0m. Recurring revenue remained stable at just under £4m, with new subscription products expected to contribute from FY27 onwards. Ocular delivered a resilient performance, with revenue of £11.8m, gross margin rising to more than 32% and EBITDA increasing to £1.2m. Synectics also maintained a strong debt-free balance sheet, with £10.5m of net cash at the half year and an interim dividend of 2.2p per share. Strategic progress includes faster product deployment, new subscription offerings, enhanced cyber assurance, partner certification, global demand-generation initiatives and investment in systems, data and automation. The Group continues to see substantial opportunities across critical infrastructure, energy, transport, security and gaming markets, supported by a strong order pipeline and new customer wins. Management expects FY26 performance to remain achievable, with adjusted EBITDA guidance of £3.7m–£4.1m depending on the timing of Middle East oil and gas orders. The transformation is expected to support faster revenue growth, higher-quality recurring revenues and improved profitability from FY27 onwards.