Table of Contents
What changed
Revenue rose 15.7% to NZ$2,045.0m, but every earnings line moved the other way: EBITDAF fell 6.3% to NZ$463.0m, PBT fell 30.2% to NZ$173.0m and NPAT fell 31.9% to NZ$141.0m. Operating cash flow slipped 5.1% to NZ$338.0m, while cash on the balance sheet more than doubled to NZ$163.0m. The balance sheet expanded sharply — total assets up NZ$1,093.0m (+15.9%) — with gross borrowings lifting NZ$200.0m to NZ$1,491.0m. The final dividend rose 8.5% to 10.2 cents per share, taking the full-year declared dividend to 17.0 cents (vs 15.8 cents in FY20). No segment split or discontinued operation was disclosed in the extracted data.
What matters
- The profit decline is not tax-driven. PBT fell 30.2% and NPAT fell 31.9%, a gap of only 1.6pp. The effective tax rate actually rose to 18.5% from 16.5%, so NPAT is the clean read and the deterioration is operational, not below-the-line.
- Second-half earnings collapsed. HY21 accounted for 46.2% of FY21 revenue but 63.5% of EBITDAF and 92.2% of NPAT. That implies an H2 EBITDAF of roughly NZ$169.0m and an H2 NPAT of only NZ$11.0m — a sharp step-down from the first-half run-rate that the release excerpts do not fully bridge.
- Leverage and payout both moved the wrong way. Net debt rose to NZ$1,328.0m from NZ$1,212.0m, pushing net debt/EBITDAF to 2.9x from 2.5x. At the same time, the full-year dividend of 17.0 cps implies a payout ratio of 98.5% of NPAT versus 61.8% prior — dividend growth was maintained through a weaker earnings year, not funded by it.
Expectations
No quantified management target or forward-work disclosure was extracted, so this release can only be judged against its own internal shape. On that basis, the HY21→FY21 shape is unusually front-loaded: NPAT was almost entirely earned in the first half, and the implied H2 run-rate is materially below the prior-year pace. Revenue grew, but nothing in the extracted data signals that the margin compression behind the H2 NPAT step-down is one-off rather than structural.
Quality of result
Mixed. Cash conversion at the EBITDAF level was broadly stable (OCF/EBITDAF 73.0% vs 72.1%), and reported free cash flow actually improved to NZ$282.0m from NZ$242.0m on lower capex (NZ$254.0m vs NZ$279.0m). However, working capital tightened against the company: trade debtors rose 29.0% to NZ$311.0m, outpacing revenue growth and lifting receivable days to 55.5 from 49.8. The company's stated free cash flow also does not reconcile to a simple OCF-less-capex bridge in the extracted materials. With no non-recurring items disclosed and no segment detail, the quality of the earnings decline itself is difficult to parse — and the combination of falling EBITDAF, rising leverage and a near-100% payout ratio is not a durable configuration if H2 conditions persist.
Unresolved
- What specifically drove the second-half EBITDAF step-down from NZ$294.0m in HY21 to an implied NZ$169.0m in H2 — hydrology, wholesale pricing, cost inflation, or trading losses?
- Why did trade debtors grow roughly twice as fast as revenue, and is any of that balance at risk?
- How does the company reconcile its disclosed free cash flow of NZ$282.0m to statutory operating cash flow and total capex?
- Is the 98.5% NPAT payout ratio sustainable alongside the NZ$1,093.0m balance-sheet expansion and rising net debt/EBITDAF?
This briefing cannot assess segment-level profitability, management commentary on H2 drivers, or forward guidance, because none of those were present in the extracted release.
Key metrics
| Metric | FY21 | FY20 | Change |
|---|---|---|---|
| Revenue | $2045m | $1768m | +15.7% ↑ |
| Net profit after tax | $141m | $207m | -31.9% ↓ |
| Net cash inflow from operating activities | $338m | $356m | -5.1% ↓ |
| Final dividend per share | 10.2c | 9.4c | +8.5% ↑ |
| Profit before tax | $173m | $248m | -30.2% ↓ |
| Cash and cash equivalents | $163m | $79m | +106.3% ↑ |
| Total assets | $7978m | $6885m | +15.9% ↑ |
Reference: annolyse.ai/briefings/mcy-fy21
Analytical metrics
| Metric | FY21 | FY20 | Context |
|---|---|---|---|
| PBT growth | -30.2% | — | — |
| Effective tax rate | 18.5% | 16.5% | — |
| OCF / EBITDAF (cash conversion) | 73.0% | 72.1% | stable |
| FCF pre-lease | $282.0m | $242.0m | +$40.0m |
| FCF / NPAT | 200.0% | 116.9% | complementary conversion metric |
| Capex % revenue | 12.4% | 15.8% | — |
| Capex | $254.0m | $279.0m | −$25.0m |
| Free cash flow | $282.0m | $242.0m | +$40.0m |
| Debtor days | 55.5 | 49.8 | +5.7 days |
| Inventory days | 4.3 | 4.5 | -0.3 days |
| Trade debtors | $311.0m | $241.0m | +$70.0m |
| Net debt | $1328.0m | $1212.0m | +$116.0m |
| Net debt / EBITDAF | 2.90x | 2.50x | Weakening |
| Gross borrowings | $1491.0m | $1291.0m | +$200.0m |
| Payout ratio vs NPAT | 98.5% | — | — |
| ROE (annualised) | 3.4% | 5.5% | Weakening |
| HY21 share of FY21 revenue | 46.2% | — | Other half was 53.8% |
| HY21 share of FY21 EBITDAF | 63.5% | — | Other half was 36.5% |
| HY21 share of FY21 NPAT | 92.2% | — | Other half was 7.8% |
| Profit from continuing operations | $141.0m | $207.0m | −$66.0m |
Reference: annolyse.ai/briefings/mcy-fy21
This analysis was generated using Annolyse, an AI-powered tool that analyses NZX/ASX 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.