Verbrec Ltd RaaS Outlook Interview Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Graeme Carson - Raas Research Group Pty Ltd - Analyst : Okay. Look, it's a great time to be discussing Verbrec. You've made some pretty material announcements over the past couple of months. But before we go into that with divestments and acquisitions, can you give us a brief overview of the Verbrec engineering business as it stands today in regard to maybe the footprint and the type of work that you do and the industries you service?

Question: Graeme Carson - Raas Research Group Pty Ltd - Analyst : Absolutely, Mark, that's showing through in the numbers as well. But over the past month or two, you've made some pretty significant announcements in regard to a divestment and an acquisition, and that really do reshape what the business looks like going forward. Engineering has always been the lion's share of your revenue, but you did have a training business as well in competency training, which you have announced you're divesting. Can you tell us the thinking behind that decision and the benefits to your group on the back of it?

Question: Graeme Carson - Raas Research Group Pty Ltd - Analyst : Yeah, okay. Well, that leads you to the obvious next part of the discussion, which is your recent acquisition, a company called Alliance Automation. It looks like a great acquisition on many levels for you at an exceptional price. So what do you -- what attracted you to that business? And how does it change the face of the Verbrec Group overall? LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 08, 2025 / NTS, VBC.AX - Verbrec Ltd RaaS Outlook Interview

Question: Graeme Carson - Raas Research Group Pty Ltd - Analyst : Yeah. Okay, great. Now, you spoke about the margins in the Alliance Automation business a period of time ago, and you think that there's an opportunity now to release value in that business as the margins have contracted. You can't help but notice some parallels with the traditional engineering business you inherited at Verbrec when you took over two or three years ago. Now, at that point in time, I think Verbrec was loss-making at the EBITDA line, and revenues were around about $100 million. In the last two years since FY23, you've now improved to deliver EBITDA margins above 9%. On revenue, that's a little bit lower, around $80 million. The Alliance Automation business is doing EBIT margins closer to 3% at the moment, but again has a significant revenue base of over $60 million. So do you see a similar opportunity to improve this performance even before we talk about leverage to the upside with synergies on a combined group?

Question: Graeme Carson - Raas Research Group Pty Ltd - Analyst : Yeah, I mean, that's one thing that stands out, I guess, over the last couple of years with Verbrec is that the cleanliness of the results, which isn't a given in a lot of engineering business. So that's very commendable. So now from here, you've bought -- you've made this acquisition at a very good multiple of between 5 and 5 times EBITDA, depending on how you cut the numbers. You're cash flow generative. You're selling the training business, which net you $11.5 million in cash. Haven't got any significant levels of debt. So you've actually got more balance sheet capacity probably to make more bolt-on acquisitions if you so choose. Is that still part of the strategy at the moment?

Question: Graeme Carson - Raas Research Group Pty Ltd - Analyst : Yeah. Now, listen, first, congratulations on the turnaround of the existing Verbrec business. You look like you've got an exciting acquisition. The company's currently valued a market cap of low 40s with, let's say, net $9 million in cash in the next couple of months. So you've got LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 08, 2025 / NTS, VBC.AX - Verbrec Ltd RaaS Outlook Interview a neat enterprise value of low to mid 30s. On a combined basis, $10 million EBITDA is probably there or thereabouts without having removed a great deal of fossil leverage and revenue synergies in itself. So it looks like a great opportunity. So I guess we look forward to further progress on the existing business and the merged business, and hopefully, you can release some significant value from Alliance Automation.

Question: Graeme Carson - Raas Research Group Pty Ltd - Analyst : Likewise. Thank you very much for your time, Mark. Appreciate it.