Synertec Reports 7.7% Revenue Rise, $4.6m Net Cash, and 32 New Engineering Projects

Financial Performance and Cash Position

Synertec Corporation Limited (ASX: SOP) has reported a solid financial performance for the third quarter of fiscal year 2025, with group revenue and other income rising 7.7% quarter-on-quarter to $4.4 million. The rolling 12-month revenue reached $18.1 million, underscoring steady growth momentum. The company maintains a healthy net cash position of $4.6 million and retains $11.5 million available under its Altor facility, providing considerable capital flexibility to support ongoing operations and growth initiatives.

Despite a net operating cash outflow of $1.7 million for the quarter, Synertec’s cost reduction strategies have delivered approximately $2 million in savings year-to-date, with further efficiencies expected as the fiscal year progresses.

Powerhouse Technology Demonstrates Resilience

Synertec’s flagship Powerhouse microgrid units have proven their robustness and reliability, operating autonomously with greater than 99.9% availability even amid the severe weather disruptions caused by tropical cyclone Albert in Queensland. This resilience highlights the technology’s competitive advantage over traditional fossil fuel generators, which often fail or run out of fuel during such events due to logistical challenges.

Management has also advanced the design and cost-efficiency of multi-unit Powerhouse installations, with final commissioning delayed only by weather-related site access issues. The company’s strategic supplier engagements in China have secured bulk discounts on advanced battery technology, promising enhanced reliability, longer service life, and significant cost savings. What's more, Synertec is progressing a promising partnership with the world’s largest battery manufacturer to integrate advanced battery systems with its AI-enabled grid-forming control technology, aiming to scale utility-level energy solutions.

US Patent Approval for LNG Custody Transfer System

In a significant intellectual property milestone, Synertec’s innovative Liquid Natural Gas (LNG) Custody Transfer System (CTS) has received US patent approval. This compact and highly accurate fiscal measurement system addresses critical challenges in LNG cargo valuation by compensating for line pressure fluctuations that undermine traditional systems. Given the high monetary value of LNG cargos, typically $15 million to $20 million, this technology could prevent substantial revenue losses and is expected to accelerate approvals in other key jurisdictions.

Engineering Division Gains Traction

The Engineering business unit continues to build momentum, securing 32 new projects during the quarter and an additional 21 contracts since quarter-end. Notably, Synertec won its first Water Corporation Process Control Technologies Panel project in Western Australia, validating its technical and commercial competitiveness. Expansion efforts in New South Wales and Queensland have also yielded new panel appointments with ANSTO, reinforcing the company’s footprint in critical infrastructure sectors such as water, transport, and oil and gas.

Improved trading conditions and a growing pipeline of opportunities have contributed to enhanced margins and positive cash flow in the engineering segment, signaling a sustained recovery in this business line.

Strategic Review to Unlock Shareholder Value

In light of evolving market dynamics and future trends, Synertec’s Board has initiated an expanded strategic review of the Group’s operations. The objective is to optimize value extraction from both the Engineering and Technology divisions, ensuring the company’s strategy remains aligned with shareholder interests and the broader transition to a low-carbon economy.

As Synertec prepares to showcase its innovations at upcoming industry conferences in Perth and Brisbane, investors will be watching closely for updates on multi-unit Powerhouse deployments, the progress of strategic partnerships, and the outcomes of the ongoing strategic review.