Wellington's maiden NZ$0.4m profit on IoT mix and 71% EBITDA lift

EBITDA rose 71.2% to NZ$4.2m on revenue up 5.0% to NZ$61.7m, lifting the EBITDA margin to 6.8% — above Annolyse's historical baseline range of 2.2%–4.1% (3-period mean 3.2%). PBT swung from a NZ$0.5m loss to a NZ$0.6m profit (+241.6%) and NPAT moved from a NZ$0.7m loss to NZ$0.4m (+162.8%).

The mix is the story behind the margin: IoT (Wellington Connect) revenue rose 31.6% to NZ$24.0m at a disclosed 40.8% gross margin, versus Motors at NZ$37.7m on 18.2%. Operating cash flow was NZ$3.0m and pre-lease FCF NZ$2.6m. The balance sheet flipped from NZ$4.7m net debt to NZ$0.4m net cash, with equity more than doubling to NZ$13.1m.

• IoT now contributes 38.9% of revenue at more than double the gross margin of Motors. With IoT growing 31.6% versus a 5.0% group line, the segment mix is doing most of the work to lift EBITDA margin to 6.8% — well above the 2.2%–4.1% historical band. This matters because durability depends on IoT continuing to outgrow Motors rather than on operating leverage on a flat cost base.

• Cash quality was flattered by a working-capital release. Operating working capital fell by NZ$7.6m, sitting at the lower edge of the historical range, with debtor days dropping from 105.0 to 81.9 and inventory days from 30.4 to 28.4. That release explains why OCF (NZ$3.0m) and pre-lease FCF (NZ$2.6m) look strong against NPAT. Without it, the cash conversion picture would be materially weaker.

• Balance-sheet flexibility has been restored. Gross borrowings fell 45.7% to NZ$3.1m and cash rose to NZ$3.5m, producing a small net cash position (net debt/EBITDA of -0.09x against the historical -1.00x mean). The group now has the capacity to fund IoT investment internally rather than from drawn debt.

Prior-period commentary referenced a vision of revenue above NZ$100m within five years, but this is a strategic aspiration, not guidance, and there is no stated path or interim milestone in this filing.

The shape of FY19 was first-half-loaded: HY19 delivered 54% of full-year revenue and 58.1% of EBITDA, implying a softer second half on both. That cuts against simple annualisation of FY19 run-rates. The release does not give the reader enough to triangulate FY20, so the read is necessarily backward-looking on margin trajectory.

PBT is the cleaner operating read: it grew 241.6% versus 162.8% for NPAT, with the gap explained by the effective tax rate moving from -57.7% to 30.0% — a normalising tax outcome rather than additional operating progress. On the operating line, the EBITDA margin lift to 6.8% looks structurally supported by IoT mix, which is the more durable component.

The cash result deserves more scepticism. Cash conversion of 70.8% is within Annolyse's historical range (and below the prior 75.0%), but pre-lease FCF of NZ$2.6m sits at the upper edge of the historical range mainly because of the NZ$7.6m working-capital release. Capex fell to 0.7% of revenue from 1.4%, which also helped. If receivables normalise back toward the 98-day historical mean and capex re-rates to a more typical level, FCF would compress meaningfully even on stable EBITDA. The FCF/NPAT ratio of 575.0% should not be read as a steady-state earnings-quality signal.

This briefing cannot assess the sustainability of IoT segment growth or customer concentration risk because the filing does not disclose pipeline, contract length, or top-customer exposure.