Strong Revenue Growth and Strategic …

This article first appeared on GuruFocus.

• Full Year Revenue: $37.2 million, up 10% from $33.8 million in fiscal 2025.

• Secured Transport Division Revenue Growth: 24% increase compared to the previous year.

• NSSG Revenue Growth: 67% increase, with consulting division up 97%.

• Adjusted EBITDA: $2.3 million, a 30% increase from $1.8 million in fiscal 2025.

• Recurring Monthly Revenue (RMR): $17.2 million, up 24% from $13.8 million.

• Gross Profit: $15.6 million, a 17% increase from $13.3 million.

• Gross Margin: 41.8%, an improvement of 250 basis points from 39.3% in fiscal 2025.

• Q4 Revenue: $10.5 million, up 12% from $9.3 million in Q4 fiscal 2025.

• Q4 Adjusted EBITDA: $509,000, a 77% increase from $287,000 in Q4 fiscal 2025.

• Q4 Recurring Revenue: $4.8 million, up 35% from $3.5 million.

• Q4 Gross Profit: $4.7 million, a 42% increase from $3.3 million.

• Q4 Gross Margin: 45.2%, an improvement of 950 basis points from 35.7% in Q4 fiscal 2025.

• Cash and Cash Equivalents: $6.2 million as of March 31, 2026, up 32% from $4.7 million.

• Working Capital: $4 million as of March 31, 2026.

Release Date: July 27, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Avante Corp (TSXV:XX) reported a 10% increase in revenue for fiscal 2026, reaching $37.2 million compared to $33.8 million in fiscal 2025.

• The company’s secured transport division experienced a 24% increase in revenue, and the NSSG division saw a 67% growth, including a 97% increase in its consulting division.

• Adjusted EBITDA grew by 30% to $2.3 million, driven by higher-margin businesses and improved operating efficiencies.

• Recurring monthly revenue increased by 24% to $17.2 million, and gross profit rose by 17% to $15.6 million.

• The company maintained a strong balance sheet with $6.2 million in cash and cash equivalents, a 32% increase from the previous year, and access to a $12 million undrawn line of credit.

Negative Points

• The EBITDA margins dipped slightly from Q3 to Q4 due to additional costs related to year-end adjustments.

• The company’s growth is heavily reliant on recurring revenue, which, while providing predictability, may limit flexibility in revenue streams.

• There is a significant dependency on geopolitical situations, as seen with the elevated revenue from NSSG engagements tied to Middle East issues.

• The MAST units are still in the pilot phase in international markets, which may delay large-scale revenue generation.

• The company’s expansion plans, including M&A, involve risks associated with integrating new acquisitions and entering new markets.

Q & A Highlights

Q: Can you talk about the Target Park agreement and its rollout over the next 12 to 24 months? A: Emmanuel Mounouchos, CEO: The agreement with Target Park is a unique opportunity to address issues like car theft in parking facilities. We’re working on technology to automate billing processes in the U.S. using MAST units. This opens up significant opportunities in the above-ground parking business.

Q: Are the 18 additional MAST units dedicated to Target Park or other projects? A: Emmanuel Mounouchos, CEO: We have other projects in Northern Ontario and are preparing orders for Europe and Africa, including deployments in Cairo, Athens, and potential projects in Germany.

Q: How sustainable is the NSSG revenue profile, especially after the record high in Q4? A: Emmanuel Mounouchos, CEO: The revenue profile is sustainable, with exciting projects underway globally. NSSG is opening doors for Avante’s technology in new markets, such as the Cairo project and Halo in Romania.

Q: What is the current rate of adoption for Halo in the high-net-worth residential market? A: Emmanuel Mounouchos, CEO: Halo is expanding steadily, with growth in areas like Muskoka. We’re moving beyond our core response areas, offering detection and communication capabilities through specialized cameras.

Q: What are the expectations for EBITDA margins in the coming fiscal year? A: Raj Kapoor, CFO: We had additional costs in Q4, but expect EBITDA margins to improve this fiscal year as we scale new products and increase efficiencies.

Q: Should we consider this year’s gross margin as the new baseline, and does recurring revenue have a stronger margin profile? A: Emmanuel Mounouchos, CEO: Yes, recurring revenue has a stronger margin profile, and we expect growth in both gross margin and adjusted EBITDA as we scale new products and improve efficiencies.

Q: What is the outlook for recurring revenue in 2027, and is there a linear relationship with MAST deployments? A: Raj Kapoor, CFO: We expect recurring revenues to increase as we deploy more MAST projects and grow our traditional business, which is expanding at 10-15% annually.

Q: Can you provide more details on the MAST units being sent to Cairo, Athens, and Germany? Are these pilot projects? A: Emmanuel Mounouchos, CEO: Yes, these are paid pilot projects with significant potential. They focus on perimeter protection and other security needs, showcasing the flexibility and intelligence of our towers compared to existing market options.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.