Reported PBT fell 21.1% while cash conversion rose to 75.3%

The supplied event overlays flag the prior comparable as non-comparable and note acquisition activity in both the prior year and the interim period; management separately discloses underlying revenue growth of 12.0% and underlying EBITDA of $585m (up 7.5%), inside the disclosed guidance range of $575–600m. Underlying NPAT of $257.5m was still down 15.1%.

Cash generation strengthened materially: operating cash flow rose to $418.5m from $348.2m, lifting OCF/EBITDA to 75.3% from 57.5%. Free cash flow rose to $273m from $229.8m, taking FCF/NPAT to 126.9% (from 84.6%). Net debt fell to $918.3m and Net debt/EBITDA edged to 1.65x from 1.68x.

Capital raise is explicitly linked in the filing to balance-sheet leverage, with NZ$1.6b capital raised.

Reported revenue and PBT moved against a non-comparable base; management discloses 12.0% underlying revenue growth and 7.5% underlying EBITDA growth in line with guidance. Below EBITDA, however, underlying NPAT still fell 15.1%, so margin compression from D&A and finance costs is visible even on the company's own underlying basis. The headline numbers therefore should not be read as a clean operational decline, but the underlying numbers do not signal a full recovery either.

Cash conversion strengthened despite working-capital pressure. OCF/EBITDA improved by roughly 17.8 percentage points to 75.3%, and FCF/NPAT of 126.9% well exceeds the 84.6% prior reading. This matters because the uplift held even as inventories rose 11.1% ($134.8m), inventory days lifted to 40.0 from 33.5 and receivable days rose to 40.7 from 38.8 — suggesting prior-year working-capital absorption is now reversing through cash.

Dividend cover versus reported NPAT is now stretched. The full-year distribution of 118.5 cents implies a 108.0% payout of reported NPAT, against 43.5% in FY24, although FCF coverage sits comfortably at 44.4%. This matters because the policy is now effectively anchored to underlying earnings and cash rather than reported NPAT.

No forward targets were supplied in the extraction, so this briefing focuses on what the release does and does not support. The HY25 share of FY25 was 48.8% of revenue, 49.6% of EBITDA and 51.4% of NPAT, indicating broadly balanced halves with a marginally softer H2 NPAT.

The release does not provide quantified FY26 guidance. The gap between the 12.0% underlying revenue growth signal and the 15.1% underlying NPAT decline means the forward shape — particularly margin and finance-cost recovery — remains an open question.

Operating cash flow rose roughly 20% to $418.5m and free cash flow reached $273m even though net working capital absorbed $97.4m. Inventory days rose 6.5 days and receivable days rose 1.8 days, so the cash gain came in spite of, not because of, working-capital dynamics. Capex rose to $146m (1.2% of revenue, from 0.9%), which moderated but did not consume the uplift. The strengthening leverage profile (1.65x Net debt/EBITDA, down from 1.68x) reinforces the cash read.

Earnings quality is more nuanced. Reported NPAT sits roughly $42m below underlying NPAT, with the gap attributed in the release to M&A transaction costs, non-recurring restructuring/site transition costs and PPA amortisation. The effective tax rate of 28.6% (vs 28.7%) shows tax did not distort the read; PBT and NPAT growth moved together (-21.1% vs -20.8%), so reported PBT is the cleanest operating read. Durability depends on how genuinely non-recurring the add-backs prove to be.

This briefing cannot assess whether the disclosed underlying growth is repeatable beyond FY25 or what the FY26 trading shape is expected to look like.