Table of Contents
What changed
- Continuing-operations revenue grew 19% to NZ$4.7m (prior continuing NZ$3.9m). The headline -28.9% decline versus FY23 total revenue of NZ$6.6m reflects the removal of the now-discontinued New Zealand operation, not a top-line contraction in the ongoing franchising business.
- Group EBITDA (pre receivables impairment) of NZ$0.4m, with operating profit disclosed at NZ$0.2m in the release excerpt.
- NPAT loss widened from -NZ$3.2m to -NZ$6.4m, a 98.5% deterioration. FY24 PBT was not disclosed, so the statutory bridge between EBITDA (+NZ$0.4m) and NPAT (-NZ$6.4m) — roughly NZ$6.8m of charges — is not reconciled in the extracted materials.
- Operating cash flow inflected from -NZ$0.5m to +NZ$0.7m; closing cash rose to NZ$1.2m from NZ$0.4m while gross borrowings eased slightly to NZ$3.0m.
- Total equity flipped from +NZ$1.4m to -NZ$4.0m, with liabilities of NZ$33.3m now exceeding assets of NZ$29.3m.
- No dividend declared, consistent with prior year.
What matters
- Balance sheet turned negative. Net liabilities of NZ$4.0m are the single most significant change in the filing. Even after a positive OCF year, accumulated charges pushed equity through zero.
- The EBITDA-to-NPAT gap is not reconciled. Only a NZ$0.133m receivables impairment is explicitly called out as an adjusting item; that leaves the remainder of the ~NZ$6.8m below-EBITDA charge unexplained from the extracted text. Without FY24 PBT or a non-GAAP bridge, earnings quality cannot be cleanly assessed.
- Receivable days roughly doubled, from ~73 to ~133. Trade receivables rose 29.9% to NZ$1.7m on a continuing revenue base that grew 19%, meaning a rising portion of recognised revenue sat uncollected at year-end — a direct tension with the positive OCF headline.
Expectations
No financial targets or quantitative guidance were disclosed. The only forward anchor in the release is a non-monetary ambition of 305 UK & Ireland stores by FY34. Against the HY24 shape, H1 carried 87.9% of the full-year NPAT loss, implying an H2 loss of only ~NZ$0.77m on ~NZ$2.7m of H2 revenue. If the below-EBITDA items driving the H1 loss are genuinely non-recurring, the H2 exit run-rate is materially better than the full-year read — but the filing does not provide the disclosure needed to confirm that.
Quality of result
Mixed. The operating cash inflow of NZ$0.7m is a genuine improvement, and the franchise-royalty model continues to deliver gross margin of ~97%. Against that, three items weaken durability: (i) receivables grew faster than continuing revenue, flattering reported growth relative to cash collection; (ii) the NZ$6.4m NPAT loss is an order of magnitude larger than positive EBITDA, and the drivers sit in undisclosed lines; and (iii) equity turned negative, which is a balance-sheet result rather than a trading result but constrains future flexibility. Net debt of ~NZ$1.9m against EBITDA of NZ$0.4m implies leverage of roughly 4.7x on the disclosed metric.
Unresolved
- What specific charges bridge EBITDA of +NZ$0.4m to NPAT of -NZ$6.4m? With PBT undisclosed, the filing leaves the largest number in the P&L unexplained.
- How does the board intend to address negative equity of NZ$4.0m — via recapitalisation, debt restructuring, or trading recovery?
- Why did receivable days rise to ~133, and what is the credit quality of the franchisee receivables book following the NZ$0.133m impairment?
- Is the H2 loss of ~NZ$0.77m a sustainable run-rate, or does it still contain items that will repeat in FY25?
- FX exposure is structurally material (UK/Ireland operations, NZD reporting) but no sensitivity or hedge disclosure was provided.
This briefing cannot assess valuation, management’s recapitalisation intent, or the specific composition of the below-EBITDA charges driving the NPAT loss.
Key metrics
| Metric | FY24 | FY23 | Change |
|---|---|---|---|
| Revenue | $4.7b | $6.6b | -28.9% ↓ |
| EBITDA | $400m | — | — |
| Net profit after tax | −$6.4b | −$3.2b | -98.5% ↓ |
| Net cash inflow from operating activities | $680m | −$484m | +240.5% ↑ |
| Cash and cash equivalents | $1.2b | $445m | +163.8% ↑ |
| Total assets | $29.3b | $33.9b | -13.4% ↓ |
Segment breakdown
| Segment | Current revenue | Prior revenue | Current result | Mix shift |
|---|---|---|---|---|
| Global Franchising & Retail | — | $0.24m | — | n/a |
| UK & IRE Franchising | — | $6.4m | — | n/a |
| New Zealand | — | $0m | — | n/a |
Analytical metrics
| Metric | FY24 | FY23 | Context |
|---|---|---|---|
| OCF / EBITDA (cash conversion) | 170.0% | — | stable |
| Debtor days | 133.5 | 73.0 | +60.4 days |
| Trade debtors | $1.7b | $1.3m | +$1.7b |
| Net debt | $1.9m | $2.7m | −$0.84m |
| Net debt / EBITDA | 4.70x | — | Strengthening |
| Gross borrowings | $3b | $3.1m | +$3b |
| HY24 share of FY24 revenue | 43.4% | — | Other half was 56.6% |
| HY24 share of FY24 NPAT | 87.9% | — | Other half was 12.1% |
| Profit from continuing operations | — | −$3.1m | — |
| Discontinued operation after tax | — | −$0.1m | — |
This analysis was generated using Annolyse, an AI-powered tool that analyses NZX 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.