EBITDA hit a record $134.5m but a $30.9m charge cut NPAT 19.4%

The gap is explained by a $30.9m pre-tax non-recurring item ($22.0m after tax) sitting between the operating result and the statutory bottom line; strip it out and the company's own normalised Operating NPAT rose 20% to $61.5m. This matters because the statutory decline overstates the deterioration in the underlying wine business.

Balance-sheet movement was substantial: net debt fell $51.8m (-15.8%) to $276.8m and gross borrowings fell 14.9%. Capex fell from $46.4m to $20.7m (-55.4%), cutting capex intensity to 5.7% of revenue from 13.3%. Trade debtors fell 21.9% and inventories fell 7.2%.

The $30.9m pre-tax item pulls PBT down 19.2% and NPAT down 19.4%, while Operating NPAT — the company's reconciled underlying measure — rose 20% to $61.5m. Investors reading only the statutory NPAT decline would misjudge the trading trajectory, because the operating business grew faster than revenue and EBITDA suggest.

Deleveraging is real and cash flow strengthened. Net debt fell $51.8m to $276.8m and gross borrowings fell 14.9%. Operating cash flow rose 4.5% to $110.5m against EBITDA of $134.5m, giving an OCF/EBITDA ratio of 82.1%, a source-backed operating cash outcome. This improves financial flexibility ahead of any future capital needs.

Returns on equity weakened despite record EBITDA. ROE fell to 6.5% from 8.4% as equity grew 4.2% to $610.7m while statutory NPAT declined. This means the record operating result has not yet translated into improved returns for shareholders, reinforcing that the non-recurring charge is doing real damage to the reported year even if it does not represent ongoing operations.

This is a modest ask relative to the year just delivered, but it depends on case-sales growth accelerating from 4% to 5%, which the FY26 result alone does not yet demonstrate.

Trade debtors and inventories both fell in absolute terms, consistent with balance-sheet tightening rather than a working-capital build that would flatter cash flow temporarily.

Free cash flow relative to NPAT reached 227.3%, driven mainly by the capex pullback to $20.7m (-55.4% versus $46.4m), which lowered capex intensity to 5.7% of revenue from 13.3%. This reflects lower reinvestment this year rather than working-capital timing.

The larger quality question is the $30.9m non-recurring pre-tax charge itself. At more than half of reported PBT ($55.3m), its size means the statutory NPAT decline of 19.4% is not representative of the operating trend implied by 15% EBITDA growth and 20% normalised NPAT growth. Until the nature of that charge is disclosed in more detail, it should be treated as a discrete item rather than evidence that ongoing profitability has weakened.

This briefing cannot assess the specific accounting or commercial driver behind the $30.9m non-recurring charge, as that detail was not present in the supplied release excerpts.