Synertec (ASX: SOP) has executed a non-binding Memorandum of Understanding (MoU) with global energy giant Hitachi Energy.
The collaboration aims to jointly pursue battery energy storage system (BESS) and microgrid projects across Australia, with a focus on 5MW to 30MW BESS opportunities and the potential for larger projects.
The alliance combines Hitachi Energy's global power conversion and grid integration technology with Synertec's Powerhouse engineering-led integration platform.
The MoU term is for up to 36 months, with binding agreements to be executed on a project-by-project basis.
The intended scope includes joint opportunity identification, technical solution development, and coordinated bid strategy.
Synertec's Powerhouse Progress
Recent updates highlight continued progress in Synertec's Powerhouse segment.
The FY26 3Q update showed accelerating group revenue and an improving operating cash outflow, with ($0.5m) for FY26 YTD compared to ($3.1m) in the prior corresponding period.
Two previously announced Oil & Gas Powerhouse units are nearing completion.
These units are on track for delivery in FY26 4Q. Additionally, the TasNetworks contract for six community battery units is progressing through its concept design phase.
This TasNetworks project is expected to support Powerhouse revenue doubling in FY27 to more than $5.0m, up from a $2.4m forecast for FY26.
The installed Powerhouse fleet continues to operate reliably, generating revenue with greater than 90% EBITDA and over 99.9% power availability.
Engineering Services Growth
Synertec's engineering services segment has also shown strong performance.
The FY26 1H results indicated a 144% increase in Engineering EBITDA compared to the prior corresponding period.
The engineering pipeline expanded to 322 opportunities valued at $129m as of FY26 3Q, an increase from the $135m pipeline (including $44m in tenders submitted) reported in FY26 1H.
Recent contract awards for the engineering division include Sydney Water operational technology upgrades.
Synertec has also secured SCADA panel appointments with clients such as South Gippsland Water.
Financial Health and Risks
Synertec achieved its first half-year net operating cash inflow of $0.5m in FY26 1H, a significant improvement since FY19.
As of the FY26 3Q period end, the company reported cash at bank of $1.7m and $15.5m in unused finance facilities.
Despite positive momentum, key risks remain including Powerhouse execution risk, specifically around factory-to-field scaling and timely completion of units.
There is also conversion risk, as high enquiry and tender activity may not fully translate into revenue in the near term.
Additionally, the Technology segment (which includes Powerhouse) has recorded ongoing EBITDA losses, which investors will closely monitor as the company scales its operations.
