Shearwater Group (SWG) has reported unaudited interim results for the six months to 31 December 2025, highlighting strong revenue growth alongside improving operational performance.
Revenue rose 31% year-on-year to £14.0 million, reflecting organic growth and continued contribution from prior contract wins. Meanwhile, adjusted EBITDA was broadly break-even at £0.0 million.
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Adjusted administrative expenses fell 6% to £2.9 million, driven by cost reduction initiatives and restructuring actions implemented in FY25. Cash at period end stood at £2.2 million, although this was temporarily impacted by project timing, with the underlying position closer to £3.7 million.
Operationally, the group reported strong Services momentum, supported by demand from blue-chip customers across telecommunications, financial services and government. This included a £7.3 million contract extension with a leading mobile network operator, alongside expansion with a central government department.
Furthermore, Shearwater highlighted a return to profitability in its Pentest division following restructuring, while demand for on-premise software remained robust, particularly in highly regulated sectors. Trading into the second half has also started positively, with a £9 million renewal and extension secured shortly after the period end.
Separately, Robin Southwell was appointed as Chair, effective 1 February 2026.
Shearwater’s Group CEO Phil Higgins said: "The first half of FY26 represents a period of continued progress for the Group, with good revenue growth and improving operational performance. We continue to see robust demand from customers operating in high threat environments, particularly across Telecommunications, Financial Services and Government, where cyber security remains a critical strategic priority.
"Our Services business delivered strong momentum during the period, supported by material multi-year contract wins and a return to profitability in the Pentest business following the actions taken in FY25. At the same time, we have continued to invest in our software portfolio, with notable customer expansions, reinforcing our confidence in its medium-term potential.
"Against a favourable and growing cyber security market backdrop, we enter the second half with a strong pipeline of opportunities. With recent contract wins and margin improvement expected as new solutions are delivered, we remain confident in our ability to deliver improved performance in H2 and to meet our FY26 market expectations."
Looking ahead, the Group expects margin improvement in the second half as new solutions are delivered, supported by a strong pipeline and contracts already secured.
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Shearwater’s interim results underline a business still in transition, balancing strong top-line growth with ongoing margin recovery. However, with cost controls taking effect, key divisions returning to profitability and a solid pipeline underpinning H2, the group appears well positioned to deliver improved performance over the remainder of the year.