Leverage stretched to 4.31x as capex hit 86.6% of revenue

Revenue lifted 6.8% to $300.3m as borders began reopening, but reported EBITDA fell 52.7% to $336.4m and PBT fell 65.6% because the FY21 comparable carried investment-property revaluation gains that did not repeat at the same scale. The company's preferred Operating EBITDAFI was down 16% to $144.5m — a cleaner read on underlying trading. NPAT fell 58.7% to $191.6m, helped by a tax credit. Pre-lease free cash flow was -$158.8m, and no final dividend was declared.

Net debt / EBITDA of 4.31x sits above Annolyse's historical range (mean 3.16x, range 1.80x-4.30x). Because FY21 EBITDA was itself inflated by revaluation gains, the underlying leverage measured against Operating EBITDAFI of $144.5m is materially higher than the headline ratio implies. This matters because the balance sheet is now funding a step-up in capex with no dividend buffer.

Cash conversion flattered by an unusual working-capital release. OCF rose to $101.2m from $61.0m, but trade debtors fell $15.7m to $8.2m, producing a working-capital release of $15.9m. Annolyse's historical baseline shows working capital has built by an average of $3.5m across each of the prior three comparable periods, with no prior release. Strip that swing out and underlying cash generation is materially weaker; OCF / EBITDA at 30.1% remains at the lower edge of the historical range.

Capex outpacing operations. Capex of $260.0m equals 86.6% of revenue and produced pre-lease FCF of -$158.8m. With no dividend, the gap was absorbed by gross borrowings, which rose to $1.5b.

The interim split shows HY22 generating only $60.3m of EBITDA (17.9% of the full year), implying a second-half EBITDA run rate of $276.1m as international travel resumed late in the period. Revenue is less skewed, with H1 contributing 42.0% of the full year.

The gap that matters is between the H2 trading exit rate and the capex plan: at $260.0m of capex versus Operating EBITDAFI of $144.5m, the funding shortfall persists unless trading rebuilds materially through FY23. The release does not quantify FY23 capex, traffic, or aeronautical pricing — so the durability of the implied H2 run rate is the unresolved variable.

Reported EBITDA of $336.4m also reflects investment-property fair-value movements — the company's own Operating EBITDAFI of $144.5m strips these out and is down 16% versus FY21.

Operating cash flow's apparent strength is balance-sheet-assisted. Trade debtors fell from $23.9m to $8.2m, releasing $15.9m. Annolyse's historical baseline records working-capital builds averaging $3.5m across the prior three comparable periods, with no prior release, so this swing is not part of a normal pattern and reversibility is the key question. Cash conversion of 30.1% sits at the lower edge of the historical range even with that release included. The pre-lease FCF shortfall of $158.8m was absorbed onto the balance sheet, which is what drove the leverage step to 4.31x.

This briefing cannot assess forward passenger demand, regulatory aeronautical pricing decisions, or the multi-year capex envelope, none of which are quantified in the supplied data.