Revenue fell 40.2% on COVID, swinging PBT to a NZ$2.0m loss

The release attributes the bulk of the damage to Q2, where revenue fell roughly 70% year-on-year. The collapse swung profit before tax to a NZ$2.0m loss (PBT growth -408.6%) from a NZ$0.6m profit, and net profit after tax to a NZ$2.2m loss (NPAT growth -580.8%) from last year's maiden NZ$0.4m profit. EBITDA fell 71.8% to NZ$1.19m.

Despite the loss, the balance sheet strengthened: cash rose 33.3% to NZ$4.6m and gross borrowings fell 33.6% to NZ$2.0m, leaving a net cash position of NZ$2.6m. Operating cash flow fell 88.6% to NZ$0.34m. The company also completed its issuer transition from Wellington Drive Technologies (WDT) to AoFrio (AOF).

Motors revenue fell to NZ$24.4m with a NZ$2.3m segment loss; IoT, the stated growth pillar, fell from NZ$24.0m to NZ$12.5m with a NZ$1.9m loss. Disclosed segment gross margins (Motors 21.1%, IoT 43.4%) show the structural mix advantage is intact, but the volume reset removed the operating leverage needed to cover fixed costs. This matters because the FY19 thesis rested on IoT compounding revenue at +31.6%; the FY20 print does not yet show whether that trajectory survives COVID.

Cash position strengthened from working-capital release, not earnings. Operating working capital fell roughly NZ$11.7m year-on-year as trade debtors dropped 44.4% to NZ$7.7m and inventory fell 28.8% to NZ$3.4m, matching the lower activity level. ROE swung from +3.4% to -14.6%, below the historical baseline range of +3.4% to +26.8%, confirming that the equity build came from receivables conversion rather than accretive earnings.

Tax distortion is real but small. The effective tax rate of -9.1% versus +30.0% prior means PBT growth of -408.6% is the cleaner operating read; NPAT growth of -580.8% overstates the operating deterioration by 172.2 percentage points but does not change the conclusion.

The H1/H2 split shows damage was concentrated in H1: HY20 captured 95.5% of full-year EBITDA (NZ$1.14m of NZ$1.19m) and 55.5% of revenue, implying H2 EBITDA of roughly NZ$0.05m on H2 revenue of NZ$16.4m. H2 NPAT was a NZ$1.4m loss, deeper than H1's NZ$0.8m loss, so the trajectory does not yet support a clean recovery story even though Q4 demand reportedly improved. The release does not quantify expected FY21 revenue or margin recovery, so the result establishes a depressed base rather than a forward read.

The cash result looks better than earnings only because working capital deflated alongside revenue. OCF/EBITDA fell from 70.8% to 28.6%; that current ratio is within Annolyse's historical baseline range, but the prior year was a high-quality cash print, so the year-on-year deterioration is real even where the absolute level is not abnormal.

Underlying cash generation is essentially flat: pre-lease free cash flow of NZ$0.1m on capex of just NZ$0.2m (0.6% of revenue). Capex was cut nearly in half from NZ$0.4m, which preserved cash but raises a question about investment in the IoT platform during the demand trough. The net cash position is genuine, but it was built by shrinking the business, not by earning it.

This briefing cannot assess the durability of customer demand or the competitive positioning of the IoT platform from the released figures alone.