If you have followed my previous coverage of LaserBond on A Rich Life, you may recall my (Growth Gauge here) initial Laserbond article published on July 14, 2025. That piece concluded with an image explaining why I was interested in the company at that time.

A lot has happened since then! To bring us up to speed, here is a similar kind of timeline to see the progress since that articler. As you can see in the chart below, after every trading update the market has responded positively, at least initially

This article looks into the 1H FY26 Laserbond results. Although I am late for this analysis by about four months, the LaserBond share price is currently at the same level as when the results were originally published on Feb 26, despite the fact that the market initially reacted positively with a ~20% gain. 

Such volatility is common for LaserBond because it is a highly illiquid stock and its share price drifts when investors get bored. I believe this 20% retracement reflects broader market sentiment rather than a decline in business performance. More importantly, there is an immediate catalyst with the company potentially publishing its trading update for 2H FY26 in July or its official results in August, so right now is a good time to revisit the thesis.

Looking back at the FY25 results, I had three questions in mind. With the new information from the 1H FY26 results, I can now give preliminary answers:

• Can the Products division keep OEM orders stable and expand its customer base? Yes, orders remain stable, though it is still unclear if the customer base is expanding.
• Will the Services division maintain strong growth now that the investment phase is over? It is a bit of a mixed picture, while it grew compared to 1H25, it declined relative to 2H25. Management attributes this to weakness in the mining sector.
• Overall, can LaserBond maintain the margin trends seen in the second half of FY25? It is too early to say, given the typical skew between LaserBond’s first and second halves, though margins for 1H26 are notably better than in 1H25.

Before diving into the financial performance, I would like to share my thoughts on the tailwinds and headwinds LaserBond is currently facing. Understanding these factors is really helpful for seeing how management is navigating challenges and capitalizing on new opportunities.

Tailwinds: 

• Securing $1.8m worth of tungsten supply last year, nearly two years’ worth of inventory, provides significant strategic leeway. As the price of tungsten has increased nearly four to five times, LaserBond can either pass some of that cost on to customers to increase margins or outbid competitors who must purchase materials at current market prices.
• Following a heavy investment phase and issues with an OEM customer in the Product division, business performance appears to be back on track.
• Management appears to be increasingly cautious regarding specific long-term guidance. Setting long-term aspirational targets can be a losing game, as LaserBond has experienced in the past. This is good because if you hit the target, it is often already expected, but if you miss, the market can be quite unforgiving. Accurately anticipating how things will unfold in a year’s time in this political environment and the pace at which technology is moving is impossible.
• LaserBond is evolving from its family-run roots into a more professionally managed business. While one of the founders is still there, having a broader leadership team helps reduce the risk of relying too much on just one person or family. To me, this feels like a healthy step forward in LaserBond’s case. LaserBond is not a consumer brand where marketing is important. LaserBond’s growth is dependent on its product quality and salespeople’s efficiency and effectiveness at building relationships with potential clients. The new CEO Rob Freeman coming from the same industry with experience in growing businesses is positive in my opinion. 
• The company currently holds a 40% stake in Gateway and will soon have the option to increase this to 51%. This move would allow for full revenue consolidation, effectively doubling LaserBond’s reported revenue next year (but note that this will not have the same impact on profit attributable to Laserbond shareholders).
• The announced initial technology deal with Komatsu has the potential to expand the Technology division, provided the first laser machine meets the customer’s quality expectations, although note there have been false starts in this division previously
• Management reported a strong order book during 1H 2026 result, approximately 70% higher than a year ago (as of January 1, 2026). I approach this figure with some caution as changes in management or internal reporting systems could influence these figures.

Headwinds:

• Tungsten supply issues necessitate finding alternatives. These supply constraints will require R&D spending. While this investment carries the risk of yielding no results, a breakthrough (X-Clad product) could lead to lower material costs and a stronger competitive moat.
• With a relatively new CEO and CFO at the helm, the market is likely waiting for a track record of steady results before fully buying in.
• A slowdown in the mining industry could negatively impact the business.
• The inherent lumpiness of the Technology and Product segments can lead to negative surprises in any given half-year period.
• High reliance on 2 OEM customers for the Product division, losing either of those customers would be catastrophic for the Product division.
• Management can go after US expansion with an acquisition that could backfire, as is often the case

With all these in mind, let us examine the underlying business performance for 1H26.

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Financial Performance

Revenue Trends

The following chart shows LaserBond’s total revenue trend over the past decade, reaching $23m in H1 FY26. Growth is not perfectly linear, but highlights the company’s ability to expand across cycles.

When analyzed by segment (as shown in the chart below), this is the first time in a while Service division revenue did not grow compared to the previous half, with management blaming softness in the mining sector for that. Product sales have been steady for 1H FY26. This suggests that earlier weakness in the Product division was temporary rather than structural, but investors will have to be mindful of the lumpiness of this segment, provided that the majority of revenue is coming from 2 main OEM customers. While the Technology division contributed negligible revenue in 1H FY26, management has flagged that the Komatsu deal will be completed and billed in 2H FY26, which offers a growth lever outside of traditional divisions for FY26. 

Profitability

EBITDA trends indicate that Services is the primary driver of profitability. The Products and Technology segments remain more volatile, with the latter often recording modest losses.

Net profit after tax (NPAT) has steadily improved over the last decade, despite volatility in the Product and Technology divisions. LaserBond achieved $2.2 million in NPAT in the first half, marking the strongest first half result in the company’s history.

Margin Trends

Margin trends provide a clearer picture of performance. In the first half, gross profit, EBITDA, and net margins all contracted relative to the previous half but improved relative to the first half of 2025. This suggests that previous investments in staff and systems are yielding results. Management commentary suggests the tungsten price was the reason for the margin compression.

Outlook and my view on Valuation

I believe LaserBond is currently better positioned than it has been in years for several reasons.

Consider all the tailwinds listed at the start of this article, as well as the headwinds. In my opinion, looking at the situation from the outside, there is a strong possibility of the company delivering a good result for the full year

With approximately 119 million shares on issue and a price of 55 cents, LaserBond’s market capitalization is approximately $65 million.

The FY25 NPAT of $3.8 million implies a trailing P/E multiple of roughly 17x. If the company maintains its second-half run rate and historical skew, FY26 NPAT could reach $5 million to $5.5 million. If the technology deal closes in the second half, NPAT could rise to $6.5 million or higher. Even without accounting for the technology deal, I expect the stock is currently trading at or below 12x FY 2026 profit. This suggests that the asymmetry is in favor of Laserbond shareholders at the current Laserbond share price of 55 cents.

Key questions for investors for 2HFY26 include:

• Can the Products division keep OEM orders stable and expand its customer base?
• Will the Services division continue to deliver growth during mining sector softness?
• Can it complete and bill the Komatsu technology deal in 2H FY26 and does that deal have the potential to expand in future years?
• Does R&D investment in the X-Clad product have market traction?

The answers to these questions will determine whether LaserBond’s current valuation represents fair value or not.

Disclosure: The author of this article owns shares in LBL. The editor Claude Walker does not own shares in LBL. Neither will trade LBL shares for at least 2 days following the publication of this article. This article is not intended to form the basis of an investment decision and is not a recommendation. Any statements that are advice under the law are general advice only. The author has not considered your investment objectives or personal situation. Any advice is authorised by Claude Walker (AR 1297632), Authorised Representative of Ethical Investment Advisers Pty Ltd (ABN 26108175819) (AFSL 276544).

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The information contained in this report is not intended as and shall not be understood or construed as personal financial product advice. You should consider whether the advice is suitable for you and your personal circumstances. Before you make any decision about whether to acquire a certain product, you should obtain and read the relevant product disclosure statement. Nothing in this report should be understood as a solicitation or recommendation to buy or sell any financial products. A Rich Life does not warrant or represent that the information, opinions or conclusions contained in this report are accurate, reliable, complete or current. Future results may materially vary from such opinions, forecasts, projections or forward looking statements. You should be aware that any references to past performance does not indicate or guarantee future performance.