Shearwater Group plc (LSE:SWG) reported revenue of £42.3 million for the financial year ended 30 June 2026, representing annualised growth of 34%, supported by contract renewals and new business within its cybersecurity services operations.
The cybersecurity, advisory and managed security services group also reported a 44% annualised increase in adjusted EBITDA to £2.6 million, while its statutory loss before tax narrowed to £0.3 million from £13.4 million in the preceding reporting period.
Shearwater ended the financial year with £5.6 million in cash and no borrowings. The company also confirmed that trading in FY2027 has remained in line with management expectations, supported by further contract awards.
FY2026 Revenue and Adjusted Profit Increase
Shearwater reported revenue of £42.3 million for the 12 months ended 30 June 2026, compared with £39.5 million for the previous 15-month reporting period.
On an annualised basis, revenue increased 34%, reflecting higher activity in the group’s Services business, particularly among telecommunications and financial services customers.
Adjusted EBITDA increased to £2.6 million from £2.2 million in the preceding 15-month period, representing annualised growth of 44%.
Adjusted profit before tax reached £1.4 million, compared with £0.6 million in FY2025, an annualised increase of 186%.
The company attributed the improvement in adjusted profitability to revenue growth and continued cost management.
Because the comparative FY2025 reporting period covered 15 months rather than 12 months, the annualised growth figures provide a comparison adjusted for the different reporting durations.
Statutory Loss Before Tax Narrows to £0.3 Million
Shearwater reported a statutory loss before tax of £0.3 million for FY2026, compared with a loss of £13.4 million in the preceding reporting period.
The company described this as a 97% reduction in its statutory loss.
The result contrasts with adjusted profit before tax of £1.4 million, reflecting the difference between statutory and adjusted measures of profitability.
Shearwater did not provide a detailed reconciliation between these measures in the trading highlights.
At the financial year-end, the group held cash balances of £5.6 million, an increase of 10% from £5.1 million at the previous year-end.
The company also confirmed that it had no outstanding borrowings as of 30 June 2026.
Services Division Secures Major Telecommunications and Financial Contracts
The Services division accounted for much of Shearwater’s revenue growth during FY2026, supported by contract activity in telecommunications and financial services.
Among the principal agreements was a contract renewal and expansion valued at approximately £25 million with a major UK-based global telecommunications provider.
The agreement contributed £12.5 million in revenue during FY2026.
Shearwater also secured a three-year contract renewal and expansion worth approximately £9 million with a global financial organisation. This agreement generated £2.7 million in revenue during the financial year.
A further £7.3 million contract extension with a UK mobile network operator was fully delivered during FY2026.
Together, these agreements represented approximately £41.3 million in contract value, although the revenue associated with them is recognised over different periods.
The company said the Services division continued to benefit from customer activity in its telecommunications and financial services markets.
Public Sector Offering Expands Through G-Cloud 15
Shearwater increased its public sector offering through the G-Cloud 15 procurement framework during FY2026.
The number of approved technologies available through its Brookcourt business increased from 31 to 55, representing growth of approximately 77%.
The expansion provides additional products available to public sector customers through the framework.
The group also continued investing in its proprietary software products and implementing operational changes within its Software division.
Management said these initiatives are intended to support the division’s performance during FY2027 and subsequent financial periods.
The announcement did not disclose separate revenue or profit figures for the Software division.
FY2027 Trading in Line With Expectations
Shearwater confirmed that trading during the opening months of FY2027 has been consistent with management expectations.
The company reported additional contract wins, including a £1.2 million agreement with one of Japan’s largest financial groups to supply core email protection technology.
Shearwater also secured a two-year contract renewal and expansion valued at £1.7 million with a central government department.
The government agreement covers the provision of an advanced threat intelligence platform.
These two contracts have a combined value of £2.9 million.
The company said its current business pipeline reflects continued demand for cybersecurity services, which management associates with the increasing frequency and complexity of cyber threats.
Shearwater expects its FY2027 financial results to be in line with market expectations, although the announcement did not specify the corresponding revenue or profit forecasts.
Board Appointments and Capital Reduction Process
Shearwater confirmed changes to its board during and after the financial year.
Robin Southwell was appointed chair in February 2026, while Jon Entract joined the board as a non-executive director following the end of the reporting period.
The company has also commenced a capital reduction process intended to provide additional flexibility in managing its capital structure.
According to Shearwater, the proposed reduction could support future shareholder distributions, including dividends or share buybacks.
The announcement did not confirm any dividend or share repurchase programme.
Chief Executive Comments on FY2026 Results
Phil Higgins, group chief executive officer of Shearwater, commented on the financial results and the company’s outlook:
“I am delighted to report a second consecutive year of strong growth in revenue and underlying profitability. Our Services business has continued to perform strongly, supported by major multi-year contract renewals and expansions and the quality of our specialist cybersecurity offering.
“We have entered FY27 from a position of strength, with a growing blue-chip customer base, continued momentum across Services and no debt. Combined with the actions taken to improve performance in Software, this gives us confidence that we can continue to deliver profitable growth and long-term value for shareholders.”
The company expects continued customer demand across its Services operations and is pursuing operational improvements within Software as part of its FY2027 plans.
More About Shearwater Group
Shearwater Group plc (LSE:SWG) provides cybersecurity, advisory and managed security services, alongside proprietary software products.
The group’s activities include cybersecurity technology provision, managed services, threat intelligence and email protection solutions for customers in telecommunications, financial services and the public sector.
For FY2026, Shearwater reported revenue of £42.3 million, adjusted EBITDA of £2.6 million and adjusted profit before tax of £1.4 million.
Its statutory loss before tax narrowed to £0.3 million, while year-end cash increased to £5.6 million, with no borrowings.
The company has reported further contract awards in FY2027 and continues to expect full-year results in line with market expectations.
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