Table of Contents
What changed
Revenue rose 189.8% to NZ$78.1m and PBT rose 216.5% to NZ$71.5m, with NPAT up 206.7% to NZ$69.2m. Operating cash flow, however, moved the other way, swinging from an inflow of NZ$6.7m in FY20 to an outflow of NZ$16.6m in FY21, a NZ$23.3m deterioration. Dividend income itself was broadly flat at NZ$0.6m (FY20: NZ$0.6m), implying the revenue line is dominated by non-cash portfolio valuation gains rather than cash receipts. The balance sheet expanded materially: total assets rose 57.6% to NZ$252.1m and equity rose 56.5% to NZ$244.4m, while liabilities remained small at NZ$7.7m. Cash on hand increased to NZ$5.1m from NZ$2.6m. The announced final dividend of 2.52 cents per share is up 22.3% on the 2.06 cent prior comparable.
What matters
- Earnings composition vs. cash composition. Reported profit of NZ$69.2m sits against a NZ$16.6m operating cash outflow, with dividend income essentially flat year on year. Almost all of the reported uplift is portfolio mark-to-market, not cash yield — an important distinction for an investment vehicle.
- ROE and payout dynamics. Accounting ROE strengthened to 28.3% from 14.4%, and the payout-vs-NPAT ratio fell to ~17% from ~44%. The higher ROE is driven by the same revaluation gains that did not convert to cash, so the lower payout ratio is arithmetic rather than a tightening of distribution policy.
- Tax normalisation. The effective tax rate rose to 3.3% from 0.1%, so NPAT growth (206.7%) trailed PBT growth (216.5%) by roughly 9.8pp. The absolute tax burden of NZ$2.3m remains very low and is not the story.
Expectations
No forward work, guidance, or stated targets are disclosed. Against the HY21 anchor, the business was clearly second-half weighted: HY21 contributed only 41.3% of full-year revenue and 37.4% of full-year NPAT, implying a 2H NPAT of roughly NZ$43.3m versus HY21's NZ$25.8m. For a closed-end investment vehicle that skew reflects market direction in the second half rather than operational seasonality, and it offers no basis for extrapolating FY22. The release does not support any forward earnings statement; it documents FY21 portfolio performance only.
Quality of result
Durability is low. The NZ$48.9m PBT improvement is not underpinned by cash — operating cash flow went backwards by NZ$23.3m, and cash dividend income from the portfolio was essentially unchanged at NZ$0.6m. The earnings are therefore revaluation-driven and will reverse in periods of weaker equity markets by the same mechanism. Receivable days moved from 21.6 to 37.9 but on a trade receivable balance of only NZ$8k this is not economically meaningful. There are no disclosed one-offs, no non-GAAP adjustments, and no borrowings, so the result is clean in disclosure terms but explicitly mark-to-market in substance. Cash conversion deteriorated materially and should be flagged as such.
Unresolved
- What portion of the NZ$78.1m revenue is realised gains on disposals versus unrealised revaluation, and how sensitive is NAV to specific positions?
- Why did operating cash flow deteriorate by NZ$23.3m when dividend income was flat — is the outflow driven by portfolio purchases classified within operating activities, or by timing of distributions received?
- Is the NZ$5.1m cash balance sufficient to fund the increased final dividend without drawing on portfolio liquidations, given the operating cash outflow?
- No NTA per share, portfolio concentration, or segment breakdown is provided, so neither premium/discount to NAV nor manager fee economics can be assessed.
This briefing cannot assess portfolio composition, realised-versus-unrealised earnings split, or NTA-based valuation because none were disclosed in the supplied materials.
Key metrics
| Metric | FY21 | FY20 | Change |
|---|---|---|---|
| Revenue | $78.1m | $26.9m | +189.8% ↑ |
| Net profit after tax | $69.2m | $22.6m | +206.7% ↑ |
| Net cash inflow from operating activities | −$16.6m | $6.7m | -348.4% ↓ |
| Final dividend per share | 2.5c | 2.1c | +22.3% ↑ |
| Operating profit | $71.5m | $22.6m | +216.5% ↑ |
| Profit before tax | $71.5m | $22.6m | +216.5% ↑ |
| Cash and cash equivalents | $5.1m | $2.6m | +93.3% ↑ |
| Total assets | $252.1m | $159.9m | +57.6% ↑ |
Analytical metrics
| Metric | FY21 | FY20 | Context |
|---|---|---|---|
| PBT growth | +216.5% | — | cleaner earnings measure |
| Effective tax rate | 3.3% | 0.1% | — |
| Debtor days | 37.9 | 21.6 | +16.3 days |
| Trade debtors | $0.0m | $0.0m | +$0.0m |
| Payout ratio vs NPAT | 17.0% | — | — |
| ROE (annualised) | 28.3% | 14.4% | Strengthening |
| HY21 share of FY21 revenue | 41.3% | — | Other half was 58.7% |
| HY21 share of FY21 NPAT | 37.4% | — | Other half was 62.6% |
| Profit from continuing operations | $69.2m | $22.6m | +$46.6m |
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.