Table of Contents
What changed
Revenue rose 8.4% to $69.8m and EBITDA rose 10.5% to $48.1m, with management citing jet fuel demand up 22%. However, profit before tax slipped 2.0% to $19.7m as depreciation and finance costs consumed the operating uplift. Net profit from continuing operations fell 11% to $12.8m, but reported NPAT rose 45.4% to $16.6m because discontinued operations swung from a $3.1m loss in HY23 to a $3.8m gain in HY24. Operating cash flow jumped 73% to $36.8m, aided by a material release of receivables (debtor days down to 41 from 60). Gross borrowings increased to $328.3m (from $297.3m) and equity declined 3.6% to $486.2m. The declared interim dividend is 4.4cps (HY23: 4.2cps).
What matters
- The headline NPAT growth is almost entirely non-operating. PBT is the cleaner read and it fell 2.0%. The effective tax rate jumped to 35.0% from 28.0%, and the uplift came from the discontinued-operations line reversing direction. Continuing-operations profit of $12.8m was 11% below HY23.
- Leverage is high and moving the wrong way. Net debt rose to ~$326.9m against an unchanged ~6.8x trailing EBITDA, with cash at just $1.4m. The dividend at 4.4cps is not covered by pre-lease free cash flow ($13.5m), implying continued reliance on debt to fund distributions and capex.
- Growth positioning improved. The announced 10-year jet fuel storage contract adds ~$55m of cumulative revenue from Q1 2027 (pre-PPI), which on an annualised basis is meaningful against current revenue of ~$140m run-rate, though the earnings contribution is not yet quantified.
Expectations
Management states FY24 guidance is unchanged, but no explicit FY24 numeric targets are provided in the extraction. FY23 shape was close to evenly weighted (HY23 represented 49.3% of full-year revenue and 50.0% of EBITDA), so HY24 revenue of $69.8m annualises to $139.7m, about 6.9% above FY23's $130.7m. That is consistent with jet-fuel-led volume recovery but does not, by itself, resolve whether finance-cost drag and a higher tax rate will allow the continuing-operations PBT decline to reverse in the second half. The new jet storage contract is a 2027 revenue event and does not support the current period.
Quality of result
The quality of the headline is weak. PBT is marginally down, continuing-operations NPAT is materially down, and the reported growth rests on a discontinued-operations swing plus a favourable year-on-year receivables movement. Operating cash conversion looks strong at 76% of EBITDA (HY23: 49%), but a $5.4m reduction in trade debtors does much of that work — a working-capital tailwind that does not repeat. The company's own "normalised free cash flow" of $32.7m sits well above the statutory pre-lease FCF of $13.5m, and the extraction does not include a full reconciliation. Capex fell to $23.3m from $32.7m, flattering cash metrics but raising a question about cycle timing rather than structural improvement.
Unresolved
- What is driving the 700bp rise in the effective tax rate, and is it a recurring feature?
- How much of the discontinued-operations $3.8m gain is a one-off versus ongoing?
- What is the gap between statutory pre-lease FCF ($13.5m) and the claimed $32.7m "normalised" figure — i.e., what is being added back?
- With net debt at ~6.8x EBITDA and cash at $1.4m, what are the covenant headroom and refinancing timelines?
- The HY24 interim dividend (4.4cps) should not be confused with the full-year FY23 payout of 12.0cps (6.3c final + 1.5c special + 4.2c interim); what is the shape of FY24 distributions expected to be?
This briefing cannot assess covenant terms, debt maturity profile, unit economics of the new jet storage contract, or the durability of the jet fuel demand uplift beyond what is disclosed in the extracted release.
Key metrics
| Metric | HY24 | HY23 | Change |
|---|---|---|---|
| Revenue | $69.8m | $64.4m | +8.4% ↑ |
| EBITDA | $48.1m | $43.5m | +10.5% ↑ |
| Net profit after tax | $16.6m | $11.4m | +45.4% ↑ |
| Net cash inflow from operating activities | $36.8m | $21.3m | +73.0% ↑ |
| Interim dividend per share | 4.4c | 4.2c | +4.8% ↑ |
| Cash and cash equivalents | $1.4m | $1.9m | -28.8% ↓ |
| Total assets | $968.4m | $957.1m | +1.2% ↑ |
Reference: annolyse.ai/briefings/chi-hy24
Segment breakdown
| Segment | Current revenue | Prior revenue | Current result | Mix shift |
|---|---|---|---|---|
| Infrastructure | — | $65.1m | — | n/a |
Reference: annolyse.ai/briefings/chi-hy24
Analytical metrics
| Metric | HY24 | HY23 | Context |
|---|---|---|---|
| PBT growth | -2.0% | — | cleaner earnings measure |
| Effective tax rate | 35.0% | 28.0% | — |
| OCF / EBITDA (cash conversion) | 76.5% | 48.9% | stable |
| FCF pre-lease | $13.5m | −$11.5m | +$25.0m |
| FCF / NPAT | 81.4% | -100.5% | complementary conversion metric |
| Capex % revenue | 33.3% | 50.8% | — |
| Capex | −$23.3m | −$32.7m | +$9.5m |
| Free cash flow | — | $34000.0m | — |
| Debtor days | 41.1 | 59.6 | -18.6 days |
| Inventory days | 14.1 | 15.8 | -1.7 days |
| Trade debtors | $15.8m | $21.1m | −$5.4m |
| Net debt | $326.9m | $295.4m | +$31.5m |
| Net debt / EBITDA | 6.79x | 6.79x | Weakening |
| Gross borrowings | $328.3m | $297.3m | +$31.0m |
| Payout ratio vs NPAT | 100.0% | — | — |
| Payout ratio vs FCF pre-lease | 122.8% | — | not covered |
| ROE (annualised) | 6.7% | 4.5% | Strengthening |
| HY23 share of FY23 revenue | 49.3% | — | Other half was 50.7% |
| HY23 share of FY23 EBITDA | 50.0% | — | Other half was 50.0% |
| HY23 share of FY23 NPAT | 47.5% | — | Other half was 52.5% |
| Forward work | $55.0m | — | — |
| Forward work / annualised revenue | 0.39x | — | — |
| Profit from continuing operations | $12.8m | $14.5m | −$1.7m |
| Discontinued operation after tax | $3.8m | −$3.1m | +$6.9m |
Reference: annolyse.ai/briefings/chi-hy24
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.