COSOL signs $11M US transit contract
Key points
- COSOL executed a 10-year, $11 million enterprise asset management contract with the Spokane Transit Authority in Washington State alongside IBM.
- The company projected first-half FY27 statutory EBITDA between $3.3 million and $3.6 million, while shares traded down 2.94% at $0.16.
- Management attributed the expected earnings recovery to an internal cost-cutting reset and higher-margin artificial intelligence and proprietary software contracts.
COSOL (ASX:COS) secured a 10-year, $11 million agreement with the Spokane Transit Authority in Washington State while forecasting higher first-half earnings.
First-half FY27 statutory EBITDA is projected at $3.3 million to $3.6 million, up approximately $0.7 million from the prior corresponding period.
“We expect to regain momentum in the Australian consulting business through the rest of this financial year, with continued focus on cost management and a target to improve operating margins by 150 points as higher margin revenue from AI and proprietary IP-driven contracts flows through,” said COSOL Interim CEO Anthony Stokes.
The company stated that underlying EBITDA should reach $3.6 million to $3.9 million after excluding $0.3 million in restructuring costs.
Management expects revenue growth to resume in the second half of FY27 and targets restarting dividend payments in the second half of FY28.
Following the announcement, the COSOL share price was down at $0.165.
In August, COSOL appointed Anthony Stokes as interim chief executive officer after reporting a 15.6% annual revenue drop to $98.6 million and a $4 million net loss.
The Brisbane-based asset management software provider previously secured an $12.8 million Australian rail contract and a digital management deal in Montreal following an internal restructuring programme.
