Objective Corporation (ASX: OCL) – Objective 2025 Annual Report Filed

Objective Corporation delivered solid financial growth in FY2026 with revenue rising 9 percent to $135 million and adjusted EBITDA up 11 percent to $52 million, yet this achievement is shadowed by the abrupt termination of the company’s 26-year partnership with the Australian Department of Defence. Management disclosed that the Defence Digital Group relationship ended without impact to FY2026 results, but expects the loss combined with discontinuation of a National Heavy Vehicle Regulator contract to reduce annualised recurring revenue by $3.2 million in FY2027. For a company with $121 million in ARR, this represents material headwind and raises questions about customer concentration risk.

Beyond the Defence setback, operational fundamentals demonstrate underlying strength. Software-as-a-service revenue grew 22 percent year-on-year over a seven-year CAGR of 27 percent, reflecting the company’s successful pivot toward recurring cloud-based revenue. Net profit after tax reached $37 million, up 5 percent from the prior year, while operating cash flow of $49 million represented 94 percent of adjusted EBITDA, indicating solid earnings quality and cash conversion. The company maintained disciplined capital allocation, investing $33.8 million into research and development at 30 percent of software revenue while continuing to generate sufficient cash to return 26 cents per share to shareholders.

Across the three business lines, Planning and Building delivered exceptional 41 percent revenue growth to $18.5 million on the back of the Australian launch of Objective Build and expanding New Zealand adoption. Information Intelligence, the largest division at $87.9 million revenue, grew 5 percent but saw closing ARR decline 5 percent, suggesting customer churn in the core business. Regulatory Solutions expanded 7 percent to $25.3 million and management is targeting international expansion into Canada and the United Kingdom alongside domestic Australian federal government opportunities.

Management’s strategic positioning around governance, trust and secure artificial intelligence appears appropriately timed. The company has embedded AI capabilities across all products through Objective Intelligence, positioned as a controlled gateway to large language models. For customers requiring sovereign capability, security accreditation and governance over decision-making, the company’s domain expertise and purpose-built solutions offer differentiation versus generic platforms, and this positioning aligns with geopolitical trends increasing focus on data residency and information control.

FY2027 guidance provides transparency on near-term headwinds. Management expects adjusted EBITDA of at least $40 million, down from $51.5 million in FY2026, reflecting the company’s assessment that disciplined investment in go-to-market capability and product development cannot fully offset Defence and NHVR ARR reductions in the year ahead. Investors should monitor quarterly ARR trends and customer additions in Defence and National Security segments to assess whether the Defence relationship loss represents a structural market issue or customer-specific setback, while also tracking win rates in international markets as evidence that management’s strategic plans are gaining traction.

View the full ASX announcement (PDF)

About Objective Corporation Limited (ASX: OCL)

Objective Corporation Limited supplies information technology software and services, specializing in enterprise content management, records compliance, and process automation solutions. The company offers products including Objective Nexus, a SaaS-based platform for information management and governance, along with solutions for secure file sharing and redaction. It operates in Australia and internationally, serving customers across various sectors requiring enterprise-scale information management capabilities.

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