Tekmar Group Reports Improved H1 Results and Record Order Backlog, Confident on H2

Record Tekmar order intake and backlog point to a stronger second half

This is the real engine behind the optimism. Order intake for the half was £29.5 million versus £10.0 million a year earlier, and cumulative order intake since 1 July 2025 is over £50 million.

Order intake is the value of contracts won in the period, regardless of when the revenue arrives. Order book is signed and committed work still to be delivered. Both are moving sharply higher, which gives Tekmar much better visibility than it had a year ago.

The order book stood at £31.7 million at 31 March 2026, up from £12.6 million a year earlier. The company also says its current order book is £30.1 million, which suggests some revenue has already been worked through since the period end while still leaving a healthy base for H2 and even FY27.

That matters because some of the recently announced offshore wind contracts barely contributed to H1. Tekmar says three European offshore wind project awards worth more than £20 million were secured in the period, with the bulk of that revenue expected beyond FY26. So the backlog is not just big – it also has duration.

Oil and gas carried H1 while offshore wind should do more of the heavy lifting later

Tekmar’s H1 revenue was heavily weighted towards oil and gas. Oil and gas revenue came in at £9.8 million, up from £3.4 million, while offshore wind revenue fell to £4.8 million from £8.1 million because of project timing.

That mix shift is important. It helped the group keep factories and teams busy, and management says high-quality oil and gas work made a significant contribution to the return to positive adjusted EBITDA.

But it also means H1 is not yet showing the full benefit of the offshore wind wins that investors probably care most about. The company says the order book is now weighted 23% to oil and gas and 77% to offshore wind, which looks like a healthier longer-term mix.

Marine infrastructure is small, at £1.6 million of revenue, but it doubled year-on-year and is clearly being positioned as an adjacent growth market. For a business like Tekmar, that extra diversification is useful.

Project Aurora strategy looks more credible now the numbers are backing it up

Management keeps referring to Project Aurora, which is its strategic plan built around scaling the business, operational excellence and strategic investment. Strategy slides are cheap. Results are not.

On that basis, Aurora is starting to earn the benefit of the doubt. Tekmar says it has reorganised the front end of the business, improved commercial effectiveness and increased utilisation. The proof is showing up in higher order intake, better gross margins and a stronger workload position.

There were also balance sheet actions in the half. The group refinanced banking facilities in October 2025 and sold Innovation House in February 2026 for £2.84 million net of fees. That improves funding flexibility, which matters for working capital in project businesses.

The expiry of the Convertible Loan Note with SCF Capital Partners also cleans things up a bit. The company says SCF remains supportive, but the absence of that mechanism leaves a simpler balance sheet for equity investors.

What still worries me – Middle East exposure, cash pressure and legacy warranty risk

This is not a risk-free recovery story. Far from it.

First, Middle East exposure is high. The company says 64% of H1 revenue came from the Middle East, up from 24% a year ago. That concentration helped growth, but it also created disruption when conflict delayed project starts, deliveries and customer receipts.

Second, cash was weaker. Cash and cash equivalents fell to £1.9 million from £3.4 million at 30 September 2025, while net debt increased to £2.7 million from £2.4 million. Operating cash flow was an outflow of £2.1 million in the half, mainly because receivables rose to £16.1 million.

Management says receipts started returning to more normal patterns from late April onwards, which is reassuring, but investors should keep an eye on cash conversion in the second half. In project businesses, profit recovery looks much better when the cash follows it.

Third, the legacy warranty issue has not fully disappeared. The warranty provision stands at £2.0 million, and there are still two remaining projects subject to final negotiation. There is also a separate historic coating issue where management believes the most likely solution would result in an outflow of about £0.2 million.

On top of that, Tekmar discloses a contingent liability relating to one further legacy project. A contingent liability means there may be a future obligation, but it is not certain enough to book as a provision yet. That is not a fresh panic signal, but it does mean the legacy tail risk is not fully closed off.

My verdict on Tekmar Group’s interim results and FY26 outlook

Overall, this is a positive update. The business is trading better, winning more work, and finally showing evidence that the turnaround work is sticking.

• Positive: Revenue up 31%, margins higher, adjusted EBITDA positive, losses much lower.
• Positive: Order intake of £29.5 million and order book of £31.7 million provide proper H2 support.
• Positive: Offshore wind wins should contribute more from H2 onwards and into FY27.
• Negative: Cash fell to £1.9 million and net debt rose to £2.7 million.
• Negative: Middle East disruption is a genuine operational risk.
• Negative: Legacy warranty and defect issues are reduced, but not gone.

If you are a retail investor, the key question is whether Tekmar can convert this stronger backlog into clean H2 delivery. If it can, the shares have a much better fundamental story than they did a year ago. If cash stays tight or Middle East disruption worsens, that recovery will feel less comfortable.

For now, I’d call this a solidly encouraging set of interim results. Not the finished article, but definitely moving in the right direction.