Table of Contents
What changed
This half covers the step-change from refining to import terminal, with discontinued-operations accounting applied from 1 April 2022. Reported revenue fell 74.1% to $29.8m and EBITDA halved to $19.7m, but the comparatives are not like-for-like: the current half is largely terminal-fee revenue while HY21 included a full six months of refining.
PBT swung to $7.8m from a $(5.7)m loss, and NPAT reached $17.2m versus a $(4.9)m loss. The headline NPAT includes an $11.6m after-tax contribution from discontinued refinery operations; continuing operations delivered $5.6m of NPAT at a disclosed ~66% EBITDA margin.
Operating cash flow moved from a $22.4m inflow to a $14.8m outflow, while capex remained elevated at $18.9m. Cash fell to $8.0m from $34.5m. Gross borrowings reduced to $223.3m and net debt eased to about $215.3m, but net-debt-to-EBITDA worsened to roughly 10.9x from 5.5x as EBITDA halved.
What matters
- Discontinued-operation uplift drives the NPAT swing. The $11.6m discontinued-ops contribution explains the gap between continuing NPAT ($5.6m) and reported NPAT ($17.2m). PBT growth of 236% is the cleaner read on the trading result, but it too spans a mixed business model.
- Cash conversion broke this half. OCF/EBITDA fell to -75.4% from +53.9%, and pre-lease free cash flow was a $33.7m outflow versus $1.2m positive in HY21. Management's framing that "significant cash flows funded two-thirds of conversion spend" should be read against a reported operating outflow; the funding came substantially from the $26.5m drawdown in cash.
- Leverage optically improved, structurally weakened. Gross borrowings fell $41.3m, but against a halved EBITDA base the balance sheet is more leveraged, not less, until the terminal's annualised run-rate earnings become the relevant denominator.
Expectations
No numerical targets or forward-work metrics are provided. HY21 seasonality is not a meaningful benchmark because the underlying business has changed. Annualising current-half continuing revenue implies roughly $59.7m, about 25.7% of FY21's revenue — a reflection of the business-model shift rather than volume weakness.
Management states that strong H1 cash flow "increases confidence in return to Dividends for FY22," but no dividend has been declared with this release and no payout framework or quantum is disclosed in the supplied excerpts. The release supports a qualitative claim of improved continuing-operations margin (c.66%), but does not yet evidence terminal-model cash generation at scale, given the H1 operating outflow.
Quality of result
The continuing-operations result is the more durable component: $5.6m NPAT on a high-margin fee base is consistent with the terminal operating model the company is transitioning toward. The $11.6m discontinued-operation contribution is by definition non-recurring and should not be extrapolated.
Cash quality deteriorated materially this half. The swing from $22.4m OCF inflow to $14.8m outflow, combined with $18.9m capex, is balance-sheet-assisted: the cash balance absorbed the majority of conversion spend. Inventory days rose to 31.6 from 26.2 as the continuing-revenue base collapsed, which is an arithmetic artefact rather than a working-capital signal. Trade receivables of $10k are not informative without a payables disclosure, which is not provided.
Unresolved
- What is the steady-state terminal-model EBITDA, capex and cash-conversion profile, and what run-rate supports the flagged return to dividends?
- What is the remaining conversion-capex commitment and its funding path, given cash fell to $8.0m and OCF is currently negative?
- Why is the effective tax rate 27.5% this half when the prior period recorded a tax benefit — is the current rate representative going forward?
- What is the nature and expected duration of the discontinued-operation contribution, and are there residual refinery decommissioning or remediation liabilities not evident in the excerpts?
- What is the forward-period fee contract structure and counterparty concentration under the terminal model?
This briefing cannot assess the economics of the terminal operating model on a full-period, normalised basis because only one partial half of continuing-operations data is available and no forward guidance or target disclosures were supplied.
Key metrics
| Metric | HY22 | HY21 | Change |
|---|---|---|---|
| Revenue | $29.8m | $115.3m | -74.1% ↓ |
| EBITDA | $19.7m | $41.5m | -52.6% ↓ |
| Net profit after tax | $17.2m | −$4.9m | +449.7% ↑ |
| Net cash inflow from operating activities | −$14.8m | $22.4m | -166.3% ↓ |
| Operating profit | $11.4m | −$0.3m | +4210.8% ↑ |
| Profit before tax | $7.8m | −$5.7m | +236.3% ↑ |
| Cash and cash equivalents | $8.0m | $34.5m | -76.7% ↓ |
| Total assets | $1129.8m | $1114.1m | +1.4% ↑ |
Reference: annolyse.ai/briefings/chi-hy22
Segment breakdown
| Segment | Current revenue | Prior revenue | Current result | Mix shift |
|---|---|---|---|---|
| Oil refining | — | $90.3m | — | n/a |
| Infrastructure | — | $25.2m | — | n/a |
Reference: annolyse.ai/briefings/chi-hy22
Analytical metrics
| Metric | HY22 | HY21 | Context |
|---|---|---|---|
| Effective tax rate | 27.5% | n/m (loss period) | prior loss period |
| OCF / EBITDA (cash conversion) | -75.4% | 53.9% | deteriorated |
| FCF pre-lease | −$33.7m | $1.2m | −$34.9m |
| FCF / NPAT | -196.0% | -24.4% | complementary conversion metric |
| Capex % revenue | 63.2% | 18.1% | — |
| Capex | −$18.9m | −$20.8m | +$2.0m |
| Free cash flow | — | $1.2m | — |
| Debtor days | 0.1 | 0.0 | +0.0 days |
| Inventory days | 31.6 | 26.2 | +5.4 days |
| Trade debtors | $0.0m | $0.0m | −$0.0m |
| Net debt | $215.3m | $230.1m | −$14.9m |
| Net debt / EBITDA | 10.90x | 5.50x | Weakening |
| Gross borrowings | $223.3m | $264.6m | −$41.3m |
| Payout ratio vs NPAT | 0.0% | — | — |
| Payout ratio vs FCF pre-lease | 0.0% | — | covered |
| ROE (annualised) | 3.3% | -0.9% | Strengthening |
| HY21 share of FY21 revenue | 49.7% | — | Other half was 50.3% |
| HY21 share of FY21 EBITDA | 57.0% | — | Other half was 43.0% |
| HY21 share of FY21 NPAT | 0.9% | — | Other half was 99.1% |
| Profit from continuing operations | $5.6m | −$4.9m | +$10.5m |
| Discontinued operation after tax | $11.6m | — | — |
Reference: annolyse.ai/briefings/chi-hy22
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.