Hansen Technologies (ASX:HSN) detailed a stronger first-half performance for FY2026, highlighting revenue growth, a sharp lift in profitability, and what management described as tangible benefits from embedding artificial intelligence across its operations. Managing Director and CEO Andrew Hansen and CFO Richard English also reiterated expectations for a stronger second half and targeted a full-year EBITDA margin of approximately 30%.
Financial performance and regional mix
Management reported first-half revenue of AUD 191 million, up 7.3% year-on-year, with both operating verticals contributing positively. English noted that the prior year’s first half was softer than the second half, and said the company expects the FY2026 second half to be stronger than the first.
On foreign exchange, English said the first half saw modest FX tailwinds that were “immaterial,” but that the strengthening Australian dollar more recently is expected to create a modest full-year FX headwind on revenue. He added that this is largely offset because a significant portion of costs are in overseas jurisdictions (including GBP, euro, and Canadian dollars), meaning the stronger Australian dollar helps reduce the cost base.
Margin expansion and cash generation
Profitability improved materially. Management cited EBITDA of AUD 5.7 million, described as a 46.1% increase on the prior corresponding period, and an EBITDA margin of 29.2%, up from 21% in the prior-year half. English attributed the step-up to productivity gains that are evident across delivery and corporate functions and said the company expects these gains to continue over at least the next 12–24 months.
Hansen also pointed to stronger cost discipline, operational improvements, and productivity gains as drivers of earnings and said management sees further opportunities for margin improvement. The company’s NPAT increased by 142% compared to the prior corresponding period, according to management.
Cash generation was a central theme. English said operating cash flow was AUD 54 million in the first half, compared with AUD 10 million a year earlier, while acknowledging that the prior period included working capital buildup and restructuring costs (including those related to powercloud). He also highlighted:
- AUD 15 million of R&D investment in the first half (about 8% of turnover), with a “significant portion” directed into AI applications
- The acquisition of Digitalk for AUD 65 million net of cash, closing 31 December
- Dividend payments including AUD 1 million paid in the half and another circa AUD 10 million scheduled for March
- Debt reduction of about AUD 30 million in the half, with additional paydown in January
Following Digitalk, English said the company’s leverage ratio was 0.4 and declining, and he expects Hansen to become net cash positive at some point in FY2027. He also said dividends paid over the last three years total AUD 71 million.
Business segment commentary and revenue composition
In communications and media, management reported 13.5% year-on-year growth, again led by EMEA. English said the business (excluding Digitalk) is expected to grow half-on-half into the second half, and management expressed optimism that momentum could extend into FY2027 based on pipeline discussions.
In energy and utilities, revenue rose 3% year-on-year. English emphasized profitability improvement, saying margins expanded from 13% to 42%, supported by an 11% reduction in costs year-on-year. He cited sales efforts and pipeline activity including municipal opportunities in North America, a recent win in Lithuania, and interest in the Baltics.
English also underscored the growth in support and maintenance revenue, calling it the “predictable, profitable backbone” of the business. He cited a three-year CAGR of 18% and attributed recent strength to implementations transitioning into ongoing support contracts, as well as customer renegotiations. In Q&A, English described part of the current uplift as “more of a one-off,” while saying the underlying trend remains positive, though he said he would “temper it a touch” heading into FY2027.
License revenue was expected to be lower in FY2026 than FY2025. English said FY2026 license revenue would be no more than 8%–10% of total revenue, compared with the prior year’s benefit from large deals such as a VMO2 license arrangement in the second half of FY2025. He said license fees should be stronger in the second half of FY2026, particularly in communications and media, but “nowhere near” last year’s level.
AI strategy, products, and competitive positioning
Andrew Hansen said AI is “well entrenched and embedded” in the company and described it as a structural shift rather than an experimental initiative. He said the company has used tools such as Copilot for more than 2.5 years and emphasized that Hansen is not retrofitting AI into its products. A key concept discussed was Retrieval Augmented Generation (RAG), which management said enables AI outcomes grounded in customer-specific data held within Hansen systems rather than public information.
Management described AI as embedded across workflows including engineering, sales, and delivery, contributing to faster execution and speed to market in highly regulated environments. Andrew Hansen said the company now has eight AI-enabled products in use and described these as not pilots but “already embedded,” though in Q&A he also characterized some as proof-of-concept deployments in use by customers but not necessarily at full scale. Examples cited included:
- A trading application using predictive intelligence to forecast power consumption and support futures contracting
- Agentic IVR to improve call routing and first-contact handling
- Workflow and exception handling informed by historical customer interactions
- AI orchestration for behind-the-meter assets such as solar and EVs
- Natural language product catalog functionality to speed product setup
- Support for EV charging optimization and customer self-service
The company said it is expanding AI capability through AI centers in California and London, an internal “AI champion network,” and hackathons designed to develop and deploy productivity improvements. English also noted that capitalized development costs declined in the period, and in Q&A he said the company is “getting a lot more done for less,” referencing AI tooling and faster development.
Addressing questions about whether AI could commoditize systems of record, Andrew Hansen argued that customer data is private, accuracy is critical, and regulated industries cannot tolerate “hallucinations,” making RAG in a ring-fenced environment important. He also said switching away from entrenched systems risks losing deep operational history that customers use to understand patterns and predict outcomes.
Digitalk acquisition and outlook
Management said Digitalk, acquired and completed on 31 December, has strong customer retention and is being transitioned under the Hansen unified brand strategy. Andrew Hansen described cross-selling opportunities and said the acquisition thesis included using Hansen’s global reach to expand Digitalk beyond its base in Milton Keynes. He also suggested Hansen’s AI capabilities could help accelerate Digitalk’s product evolution.
For the remainder of FY2026, management said it expects second-half revenue to be higher than the first half and is targeting a full-year EBITDA margin of approximately 30%. In Q&A, the company declined to provide more specific revenue guidance, noting FX variability and pipeline timing, and reiterated that formal full-year guidance had been withdrawn in August.
English said Hansen remains positioned for further acquisitions, noting a cautious approach to valuations and the intent to buy “patiently” and “prudently,” including looking at listed opportunities where the company believes it can add value.
About Hansen Technologies (ASX:HSN)
Hansen Technologies Limited develops, integrates, and supports billing systems software for the energy and utilities, and communications and media sectors. It provides Hansen suite, a set of software applications; and consulting services related to billing systems, as well as sells billing applications. The company also offers application service fees for upgrades, configuration, implementation, and customization; license, support, and maintenance services; and provision of hardware and software licences.
