Meridian EBITDAF fell 32.5% as PBT swung to a $619.0m loss

Below EBITDAF the swing was far larger: profit before tax moved from +$594.0m to -$619.0m (-204.2%) and net profit after tax from +$429.0m to -$452.0m (-205.4%), a gap well beyond the EBITDAF decline that is not explained by any disclosed one-off item. Operating cash flow fell 52.3% to $318.0m, and the second half was materially weaker than the first, with half-year NPAT of -$121.0m implying an ‑$331.0m second-half result.

OCF/EBITDAF fell to 52.0% from 73.7% in the prior year, meaning a materially smaller share of reported EBITDAF is converting to cash this year, which matters because it weakens the buffer available to fund capex and dividends from operations alone.

Leverage moved against the company. Net debt/EBITDA rose to 2.37x from 1.24x as gross borrowings increased 16.5% to $1.6b, reducing financial flexibility just as the operating result deteriorated; this combination narrows headroom if hydrology or wholesale prices stay unfavourable.

The PBT/NPAT collapse exceeds the EBITDAF decline by roughly $900m, and no disclosed non-recurring item or discontinued-operation figure is available to explain the difference (the discontinued-operation line is currently unverifiable), so the scale of the loss below the operating line remains only partly explained by the energy-margin story alone.

The heavy second-half weighting of the loss (implied second-half NPAT of -$331.0m versus a first-half of -$121.0m) indicates the deterioration built through the year rather than reversing, which is relevant because it suggests the pressures behind the energy-margin decline were still active at year-end rather than transitory in the first half only.

However, the fall in cash conversion to 52.0% (from 73.7%) means a materially smaller portion of reported EBITDAF is showing up as cash this year, which changes how much confidence should be placed in the operating result as a cash generator. The full-year dividend was maintained at 21.0 cents per share against FY24's 21.0 cents, but the current payout ratio against free cash flow pre-lease was 162.6%, meaning the dividend was not covered by free cash flow this year and was funded from elsewhere on the balance sheet.

• Operating cash flow $318.0m against free cash flow of $238.0m and capex of $193.0m (4.0% of revenue)
• Dividend payout of 162.6% of pre-lease free cash flow, uncovered by internally generated cash this period

This briefing cannot assess the specific composition of the items driving the gap between EBITDAF and profit before tax, since the underlying disclosure for that reconciliation was not available for verification.