Senetas experiences stronger cash flow as revenue rises, flags FY27 sales pipeline

Senetas (ASX: SEN) has delivered a year of revenue growth and a sharp improvement in cash generation, while pointing to a strong sales pipeline heading into FY2027. The network encryption specialist reported revenue of $20.2 million for the year ended June 30, up 4.7% from $19.3 million a year earlier.

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On a constant currency basis, revenue increased 9.3%, with the stronger Australian dollar weighing on reported growth given almost 90% of Senetas’ revenue is generated in US dollars.

Product sales jumped 22% during the year, while regional growth was strongest across EMEA at 22% and ANZ at 17%. The company also recorded its first revenue from South America, with further stages of that project expected in FY2027 and beyond.

Operating cash flow swung sharply higher to $4.4 million, an $8 million improvement from the $3.6 million outflow recorded in FY2025.

Underlying operating EBITDA for the Senetas segment was $1.2 million, compared with $2 million previously. On a constant currency basis, the figure was $1.24 million, slightly below the $1.28 million recorded in FY2025.

Senetas said the decline reflected lower gross margins and the impact of currency movements.

Maintenance revenue was also below expectations due to the timing of large contract renewals and revenue recognition. However, with product sales strengthening in FY2026, Senetas expects maintenance revenue to rebound in FY2027.

CEO Andrew Wilson said the company had continued expanding the addressable market for its security products, with momentum also building across Asia and opportunities in two markets approaching initial sales.

Another potential growth avenue is its Governed Data Layer platform, which is being developed for enterprise AI governance. Senetas said the project remains at an early stage but has been supported by a US multi-tiered patent application strategy.

The company ended FY2026 with $18.6 million in cash and no debt in its operating business.

Looking ahead, Senetas said its FY2027 sales pipeline remains strong and operating revenue is currently expected to grow broadly in line with FY2026 through organic growth and a recovery in maintenance revenue.

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