Continuing-ops PBT up 27.7% but NPAT fell 88.1% on MVM exit

Underneath, continuing operations strengthened: revenue rose 11.2% to $992.6m, EBITDA rose 30.4% to $155.0m, operating profit rose 40.8% to $146.3m, and profit before tax rose 27.7% to $162.5m. Profit from continuing operations was $112.1m.

China and Other Asia carried the growth, with segment revenue of $739.0m and segment share rising 5.7pp to 74.5%; the USA segment loss narrowed. Operating cash flow rose 20.8% to $95.2m. Cash fell to $896.9m (from $1b) and gross borrowings were extinguished (from $66.8m to nil). The interim dividend lifted 35.3% to 11.5cps.

The 115.8pp gap between PBT growth (+27.7%) and NPAT growth (-88.1%) reflects the $103.7m after-tax MVM loss and a small movement in the effective tax rate (31.0% vs 34.0%). For the operating read, PBT and continuing-operations profit ($112.1m) are the cleaner measures; group NPAT is not comparable to the prior period.

Cash conversion eased even as headline cash flow rose. OCF/EBITDA fell from 66.3% to 61.4%, so the 30.4% EBITDA uplift converted to only 20.8% more operating cash. Working-capital movements helped (inventory days fell from 39.3 to 31.8, receivable days from 19.1 to 16.9), which means the deterioration is more about the EBITDA-to-cash translation than about debtor or stock build.

Capital return stepped up against a smaller capital base. The 11.5cps interim is 74.3% of group NPAT but a much more comfortable share of continuing-operations profit, and pre-lease FCF of $80.1m covers it. Combined with the elimination of gross borrowings, this signals confidence in the post-MVM business model, but cash on hand fell $145.2m and ROE printed 0.8% (vs 6.8%) because of the NPAT distortion.

Against the FY25 pattern, the first half ran at 46.9% of full-year revenue, 43.3% of EBITDA and 45.2% of NPAT, so the business is second-half weighted. Annualised current revenue is $2b, broadly tracking FY25's $1.9b base with the MVM revenue contribution now removed.

What this release supports is a stronger continuing-operations trajectory and a smaller, simpler revenue base; what it does not pin down is the quantum of the FY26 upgrade or the shape of the second half post-MVM exit.

Continuing-operations EBITDA growth (+30.4%) outran revenue growth (+11.2%), implying margin expansion, and the China and Other Asia segment delivered both volume and mix. The discontinued-operation loss is a one-off, and the prior-period NPAT base did not include it, so headline comparisons overstate the deterioration.

Two quality caveats temper the read. First, cash conversion fell from 66.3% to 61.4%; the 20.8% OCF uplift lagged the 30.4% EBITDA uplift, and continuing-operations profit will not repeat the working-capital release indefinitely. Second, capex jumped from $2.4m to $15.1m (-1.5% of revenue, up from -0.3%), and the extraction does not detail whether this is supply-chain transformation spend or a step-change in run-rate intensity. Pre-lease FCF was $80.1m versus $76.4m, so capital intensity has risen but cash generation absorbed it. ROE of 0.8% is mechanically distorted by the MVM loss and is not a useful read on returns this period.

This briefing cannot assess the financial terms of the MVM exit, the magnitude of the FY26 guidance upgrade, or the strategic fit of any current-period acquisition because those details are not present in the supplied extraction.