Yesterday afternoon, PEXA Group Ltd (ASX: PXA) announced plans to exit its majority-owned Digital Solutions businesses, leading to around $26 million in net impairments and an update to its FY26 guidance.
What did PEXA Group report?
- Decision to exit majority-owned Digital Solutions businesses, classified as ‘held for sale’ and discontinued operations
- C$26 million in net impairments expected to be recognised
- Significant items of $7â8 million to be recognised in 1H26, excluding impairments
- FY26 group revenue guidance restated to $395â415 million, down from $405â430 million previously
- FY26 group EBITDA margin guidance upgraded to 34â37% (from 32â35%)
- FY26 group core NPAT guidance lifted to $15â25 million (from $5â15 million)
- FY26 group CAPEX guidance reduced to $50â55 million (from $60â65 million)
What else do investors need to know?
PEXA’s move comes after a strategic review found the Digital Solutions businesses weren’t the best long-term fit for the group. These businesses, including Value Australia and .id, will be divested by mid-2026, and their financials will be reported as discontinued operations for FY25 and FY26.
Costs related to redundancies and restructuring of around $7â8 million will be recognised in the first half of FY26. The company expects its cost optimisation program to deliver more than $10 million in annual cash savings. Management has already completed exits from Land Insight and Elula, with sale proceeds to be used for future growth initiatives.
What did PEXA Group management say?
CEO and Group Managing Director of PEXA Russell Cohen said:
Our decision to exit the Digital Solutions businesses reflects our disciplined focus on our core capabilities to drive long-term, profitable growth for our shareholders. While quality assets with strong management teams, the strategic review confirmed that PEXA was not the best long-term natural owner of these businesses⦠management is fully focused on accelerating our growth strategy and unlocking value from existing operations and future opportunities.
What’s next for PEXA Group?
PEXA is now focused on its core operations, integrating remaining relevant products into its “Australia” segment, and targeting continued growth in its home and UK markets. Updated guidance points to improved profit margins and cash efficiency, with capital redeployed to support the group’s long-term strategy.
Investors can expect a full update and results commentary at the 1H26 results briefing on 27 February 2026. The company will continue to seek opportunities to unlock value from its core platform and maintain a disciplined approach to capital management.
PEXA Group share price snapshot
Over the past 12 months, PEXA Group shares have risen 17%, outperforming the S&P/ASX 200 (ASX: XJO) which has risen 5% over the same period.
The post PEXA Group: Divestment drives strategy shift appeared first on The Motley Fool Australia.
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Motley Fool contributor Laura Stewart has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended PEXA Group. The Motley Fool Australia has positions in and has recommended PEXA Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial summary of the company announcement. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.