Table of Contents
What changed
Revenue grew 6.1% to NZ$744.4m, but earnings outpaced sales materially: gross margin expanded 200bps to 45.76%, lifting PBT 20.7% to NZ$122.4m and NPAT 20.1% to NZ$87.9m. The two reportable segments both grew — Homeware remained the scale driver at 61.9% of sales, while Sporting goods (38.1% of sales) showed the sharper margin improvement, with segment result margin stepping up to roughly 20.3% from 11.5%.
The cash picture moved the other way. Operating cash flow fell 9.4% to NZ$96.5m despite higher NPAT, primarily reflecting a 30.7% inventory build to NZ$119.5m (inventory days rose to ~58.6 from ~47.6). Capex stepped down to NZ$18.2m from NZ$25.5m, cushioning pre-lease free cash flow at NZ$78.3m (versus NZ$81.0m). Cash on hand edged up to NZ$102.5m, total equity grew 15.5% to NZ$299.3m, and total liabilities were essentially flat. A final dividend of 15.5 cps was declared (the full-period dividend total is not stated in the extracted data).
What matters
- Gross margin expansion is the earnings story. Sales growth of 6.1% does not explain 20.7% PBT growth on its own; the 200bps margin lift — helped by online mix rising to 21.5% of group sales (+21.0% online growth) — did the heavy lifting. Whether this margin level is a sustainable new baseline or a cycle-high on favourable discounting discipline is the central question.
- Cash conversion deteriorated. OCF/NPAT dropped from ~146% to ~110% as NZ$28m of incremental inventory absorbed working capital. Pre-lease FCF-to-NPAT fell from 110.7% to 89.1%. This is a material, directly flagged deterioration, albeit from a very strong prior base.
- Balance sheet is strengthening. Equity up 15.5%, cash up modestly, no disclosed gross borrowings in the extract, and ROE improving to 29.4% from 28.3%. Dividend coverage against pre-lease FCF sits at roughly 44%, leaving meaningful headroom.
Expectations
No forward targets or guidance were disclosed in the extracted materials, so the result cannot be benchmarked against management's own shape. The HY22 context shows the first half delivered 48.1% of full-year revenue but 54.0% of NPAT, implying a second half that was softer on the bottom line (implied H2 NPAT of NZ$40.4m versus HY22 NZ$47.5m). That skew is consistent with either margin normalisation in H2 or COVID-era disruption affecting the H2 comparable — the release does not clarify which. The filing supports a read of record full-year earnings but does not support any claim about FY23 trajectory.
Quality of result
The earnings quality is mixed. The effective tax rate was broadly stable (28.2% vs 27.8%), PBT and NPAT growth rates were within 0.6pp of each other, and no non-recurring items or non-GAAP adjustments were disclosed — so the profit line is statutory and clean. However, two items temper durability:
- The 200bps gross margin step-up is the dominant driver of earnings growth and is not decomposed in the extract between pricing, mix, and input cost effects.
- The NZ$28.0m inventory build is the direct cause of weaker cash conversion; whether it reflects deliberate positioning, supply-chain timing, or softer sell-through in H2 is unclear from the release. The implied H2 NPAT step-down versus HY22 is consistent with the latter possibility and should be watched.
FCF was partly flattered by capex falling NZ$7.4m year-on-year (capex intensity down to 2.4% of revenue from 3.6%), which is not a repeatable lever.
Unresolved
- What drove the 200bps gross margin expansion, and how much is structural versus promotional discipline in a constrained-supply environment?
- Why did inventory rise 30.7% against 6.1% revenue growth — pre-positioning, freight timing, or slower sell-through?
- What is the full-period dividend (the 15.5 cps figure is the final component only, per the extract)?
- What explains the H2 NPAT softening relative to H1, given full-year revenue still grew?
- What is the gross borrowings position? The extract does not disclose it, so true net cash/net debt cannot be confirmed.
This briefing cannot assess valuation, since no share price was provided alongside the disclosed NZ$1.3334 NTA per share.
Key metrics
| Metric | FY22 | FY21 | Change |
|---|---|---|---|
| Revenue | $744.5m | $701.8m | +6.1% ↑ |
| Net profit after tax | $87.9m | $73.2m | +20.1% ↑ |
| Net cash inflow from operating activities | $96.5m | $106.6m | -9.4% ↓ |
| Final dividend per share | 15.5c | — | — |
| Operating profit | $136.5m | $115.9m | +17.8% ↑ |
| Profit before tax | $122.4m | $101.4m | +20.7% ↑ |
| Total assets | $688.5m | $649.0m | +6.1% ↑ |
Reference: annolyse.ai/briefings/bgp-fy22
Segment breakdown
| Segment | Current revenue | Prior revenue | Current result | Mix shift |
|---|---|---|---|---|
| Homeware | $460.9m | $439.2m | $73.8m | -0.7pp |
| Sporting goods | $283.6m | $262.6m | $57.7m | +0.7pp |
Reference: annolyse.ai/briefings/bgp-fy22
Analytical metrics
| Metric | FY22 | FY21 | Context |
|---|---|---|---|
| PBT growth | +20.7% | — | — |
| Effective tax rate | 28.2% | 27.8% | — |
| FCF pre-lease | $78.3m | $81.0m | −$2.7m |
| FCF / NPAT | 89.1% | 110.7% | complementary conversion metric |
| Capex % revenue | 2.4% | 3.6% | — |
| Capex | −$18.2m | $25.5m | −$43.7m |
| Debtor days | 0.2 | 0.2 | +0.0 days |
| Inventory days | 58.6 | 47.6 | +11.0 days |
| Trade debtors | $0.4m | $0.4m | −$0.0m |
| Payout ratio vs NPAT | 39.2% | — | — |
| Payout ratio vs FCF pre-lease | 44.0% | — | covered |
| ROE (annualised) | 29.4% | 28.3% | Strengthening |
| HY22 share of FY22 revenue | 48.1% | — | Other half was 51.9% |
| HY22 share of FY22 NPAT | 54.0% | — | Other half was 46.0% |
| Profit from continuing operations | $87.9m | — | — |
Reference: annolyse.ai/briefings/bgp-fy22
This analysis was generated using Annolyse, an AI-powered tool that analyses NZX/ASX company announcements. The analysis is based on available company filings and standard Annolyse calculations. This is general information only and does not constitute financial advice. The analysis may contain errors. Always read the original company filings and consult a licensed financial adviser before making investment decisions.