Operating FY26 ahead + positive outlook with new contract ramp

Research evidence excerpt

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M

Update

August 19, 2026 04:25 AM GMT

Morgan Stanley Australia Limited+

Service Stream Ltd | Asia Pacific

Chenny Wang, CFA

Equity Analyst

Operating FY26 ahead +

positive outlook with new

contract ramp

James Bales

Equity Analyst

Edward Xu

Research Associate

AlphaSignals Earnings Reaction

Unchanged

Modest upside

Modest revision higher

Impact to our thesis

Financial results versus consensus

Direction of next 12-month

consensus EPS

Source: Company data, Morgan Stanley Research

1st look - EBITDA/NPAT beat, outlook positive and Defence mobilisation tracking to

run-rate targets.

FY26 earnings

• Revenue A$2,475m, +2% yoy, +2% vs A$2,424m VA cons

• Operating EBITDA A$163.4m, +3.5% vs A$157.8m cons

Service Stream Ltd (SSM.AX, SSM AU)

Australia Emerging Companies | Australia

Stock Rating

Industry View

Price target

Shr price, close (Aug 18, 2026)

52-Week Range

Sh out, dil, curr (mn)

Mkt cap, curr (mn)

EV, curr (mn)

Avg daily trading value (mn)

Overweight

In-Line

A$2.80

A$2.53

A$2.72-1.78

632

A$1,598

A$1,485

A$4

• Operating NPAT A$81.1m, +9% vs A$74.4m cons

• A$21.2m investment in SaaS

• Cash conversion solid 114%

• Net cash A$80.7m

• WIH A$8.2bn (A$14.2bn incl. extension options) - 85% O&M

° A$9.2bn 1H26 (A$15.4bn incl. extension) / A$7.6bn FY25 (A$12.6bn incl.

extension)

Segment

• Asset & Facilities

° Defence successful mobilisation and reiterated FY27 delivery - volumes

reaching run-rate + margins already close to run-rate with follow-on

work to come

° Foundation for expansion across broader social infrastructure

• Transport also better + in several tenders

• Utilities in-line, but margins stronger (6% 2H)

• Telco lower, but some growth bias in FY27

No specific guide but positive outlook with 85% WIH for FY27 secured + several new

contract ramp ups

We are OW SSM.

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