Table of Contents
What changed
Revenue rose only 1.1% to NZ$84.2m and underlying EBITDA was effectively flat at NZ$10.6m (+1.0%). The much larger optical gains sit below the EBITDA line: PBT rose 68.2% to NZ$2.8m and NPAT rose 39.1% to NZ$2.0m, with the NPAT growth held back by a higher effective tax rate (28.6% vs 13.6%).
The balance sheet moved meaningfully. Gross borrowings fell 25.0% to NZ$73.3m from NZ$97.7m, taking net debt/EBITDA from 9.2x to 6.9x. Total equity, however, declined 13.5% to NZ$64.3m, and cash on hand fell to NZ$0.1m from NZ$0.9m. Operating cash flow improved 18.0% to NZ$6.6m, while capex rose to NZ$2.9m, leaving pre-lease free cash flow broadly flat at NZ$3.7m. An interim dividend of 0.65 cps was declared.
What matters
- PBT growth is interest-cost driven, not operational. With EBITDA up only NZ$0.1m and gross borrowings down NZ$24.4m, the step-up in PBT principally reflects lower finance costs from the deleveraging, not margin expansion. The "39% profit growth" headline rests on the same mechanism.
- Leverage is directionally better but still high. Net debt/EBITDA of 6.9x remains elevated in absolute terms even after a sizeable reduction, and the NZ$0.1m cash balance leaves essentially no headroom outside facility capacity.
- Underlying EBITDA is an adjusted figure. Management describes the NZ$10.6m as adjusted for the sale of one care home. The reported accounting EBITDA and the adjustment quantum are not visible in the supplied data, which matters because the entire EBITDA "growth" sits inside that adjustment.
Expectations
No quantitative guidance or stated target was disclosed. Against the FY24 seasonal shape, HY24 was 49.4% of full-year revenue and 50.2% of full-year EBITDA, so there is no strong second-half skew built into the base. Annualising HY25 revenue gives NZ$168.4m, essentially matching FY24's NZ$168.7m — the release does not support a top-line acceleration thesis. The FY24 NPAT loss of NZ$(8.5)m was second-half loaded (implied H2 NPAT of NZ$(9.9)m), so the HY25 NPAT of NZ$2.0m is not directly comparable to that shape without knowing whether the same one-off drivers recur.
Quality of result
Mixed. The operating run-rate is flat: revenue +1.1%, EBITDA +1.0%, and pre-lease FCF flat at NZ$3.7m. Working capital moved in Radius's favour — receivable days fell to 26.7 from 30.1 — which contributed to the 18% OCF uplift; that is a real but not repeatable tailwind. Cash conversion (OCF/EBITDA) improved to 62.3% from 53.3%.
The PBT and NPAT growth should be read as balance-sheet-assisted rather than trading-driven, since the earnings uplift traces to lower interest rather than higher EBITDA. The declared dividend consumes 94.2% of NPAT but only ~49.9% of pre-lease FCF, so it is covered on a cash basis but leaves limited room if FCF weakens.
Unresolved
- What is reported (unadjusted) EBITDA, and how large is the care-home-sale adjustment inside the NZ$10.6m underlying figure?
- Why did total equity fall NZ$10.0m despite a NZ$2.0m profit — is there a reserve movement, revaluation, or capital return not captured in the supplied excerpts?
- Why did cash drop to NZ$0.1m alongside a 25% reduction in borrowings, and what undrawn facility headroom supports ongoing operations?
- What drove the effective tax rate from 13.6% to 28.6%, and is the HY25 rate the new run-rate?
- There is no forward-work, occupancy or bed-count disclosure in the supplied data to triangulate the revenue outlook.
This briefing cannot assess underlying occupancy trends, segment-level profitability, covenant headroom, or valuation, as none of these are disclosed in the supplied extraction.
Key metrics
| Metric | HY25 | HY24 | Change |
|---|---|---|---|
| Revenue | $84.2m | $83.3m | +1.1% ↑ |
| EBITDA | $10.6m | $10.5m | +1.0% ↑ |
| Net profit after tax | $2m | $1.4m | +39.1% ↑ |
| Net cash inflow from operating activities | $6.6m | $5.6m | +18.0% ↑ |
| Interim dividend per share | 0.7c | — | — |
| Profit before tax | $2.8m | $1.6m | +68.2% ↑ |
| Cash and cash equivalents | $0.07m | $0.91m | -92.7% ↓ |
| Total assets | $330.5m | $355m | -6.9% ↓ |
Analytical metrics
| Metric | HY25 | HY24 | Context |
|---|---|---|---|
| PBT growth | +68.1% | — | cleaner earnings measure |
| Effective tax rate | 28.6% | 13.6% | — |
| OCF / EBITDA (cash conversion) | 62.3% | 53.3% | stable |
| FCF pre-lease | $3.7m | $3.7m | −$0.01m |
| FCF / NPAT | 188.8% | 263.5% | complementary conversion metric |
| Capex % revenue | 3.4% | 2.2% | — |
| Capex | −$2.9m | −$1.9m | −$1m |
| Debtor days | 26.7 | 30.1 | -3.4 days |
| Inventory days | 1.3 | 1.5 | -0.3 days |
| Trade debtors | $12.4m | $13.8m | −$1.4m |
| Net debt | $73.2m | $96.8m | −$23.6m |
| Net debt / EBITDA | 6.91x | 9.22x | Strengthening |
| Gross borrowings | $73.3m | $97.7m | −$24.4m |
| Payout ratio vs NPAT | 94.2% | — | — |
| Payout ratio vs FCF pre-lease | 49.9% | — | covered |
| ROE (annualised) | 2.8% | 2.0% | Strengthening |
| HY24 share of FY24 revenue | 49.4% | — | Other half was 50.6% |
| HY24 share of FY24 EBITDA | 50.2% | — | Other half was 49.8% |
| HY24 share of FY24 NPAT | -16.7% | — | Other half was 116.7% |
| Profit from continuing operations | $2m | $1.4m | +$0.55m |
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.