Argosy HY22 NPAT fell 47.5% as revaluation tailwind normalised

Revenue of $53.1m is down 50.7%, profit before tax of $130.9m is down 47.3%, and NPAT of $127.0m is down 47.5% versus the FY21 twelve-month figures. Operating cash flow fell 54.2% to $40.4m on the same basis.

The underlying balance sheet moved the other way. Total equity rose 8.4% to $1.4b, gross borrowings fell 10.8% to $673.0m, and NTA per share lifted to $1.64 from $1.53, a 7.2% gain. The interim dividend component lifted to 1.6375 cents from 1.6125 cents and the full-year dividend has been reconfirmed at 6.55 cents (FY21: 6.45 cents).

FY21 is a twelve-month result and HY22 is six months, so the -50.7% revenue and -47.5% NPAT moves should not be read as deterioration. The more useful read is that six-month rental revenue annualises broadly in line with the prior full-year run-rate, consistent with a portfolio that has been actively rotated rather than shrunk.

Gearing has meaningfully improved. Gross borrowings fell $81.5m while total assets edged up $21.0m, lifting equity by $107.3m. For a property issuer, that combination of lower debt and higher revalued asset base is the cleanest read in the result and supports the conservatively geared framing in the release.

Distributable cash, not statutory profit, is the live question. Statutory NPAT is inflated by revaluation gains that do not pay dividends. The company-disclosed AFFO payout ratio of 108% — above 100% — is the more relevant signal for dividend sustainability than the 43.4% statutory NPAT payout ratio, and it sits in tension with the reconfirmed 6.55 cent guidance.

The first-half interim component of 1.6375 cents implies roughly 3.275 cents of dividend remains to be declared across the second half to hit the 6.55 cent forecast.

The shape table shows HY22 revenue effectively equals the implied full-year figure in the dataset, which reflects the non-comparable period basis rather than a true second-half collapse. Readers should treat any second-half implied figures here as artefacts of the comparison shape, not guidance.

Nugent Street sale is explicitly linked in the filing to cash-flow profile, with NZ$22m disclosed value.

Most of the $127.0m NPAT is non-cash. Operating cash flow of $40.4m against NPAT of $127.0m gives FCF/NPAT conversion of just 7.6%, which is consistent with a property vehicle whose reported profit is dominated by revaluation gains. That is normal for the sector but means statutory earnings should not be used as a proxy for distributable capacity.

Within the cash result, capex of $30.8m absorbed 57.9% of revenue and left FCF pre-lease of $9.7m. Receivable days lifted to 18.3 from 6.1, a small absolute movement ($0.9m of working capital) but worth monitoring given how lean the prior balance was. The effective tax rate of 3.0% (prior 2.7%) reflects the PIE/REIT-style tax shielding typical for this structure, so PBT and NPAT moves are tightly coupled and neither is a cleaner operating read than the other.

This briefing cannot assess portfolio-level occupancy, WALT, like-for-like rental growth, valuation cap-rate assumptions, or covenant headroom because those disclosures are not in the supplied extraction.