Table of Contents
What changed
Revenue rose 2.6% to NZD 221.8m and EBITDA rose 8.2% to NZD 23.9m. Profit before tax improved 24.3% to NZD 14.9m, and profit from continuing operations was NZD 12.7m versus NZD 9.5m. Bottom-line NPAT collapsed 99.1% to NZD 0.1m, entirely because of a disclosed NZD 12.6m after-tax loss from a discontinued operation. Operating cash flow fell 53.0% to NZD 6.3m, cash declined from NZD 12.2m to NZD 8.5m, and gross borrowings rose to NZD 12.0m, moving the group from a small net cash position to net debt of about NZD 3.5m. The final dividend was held at 4.0 cents per share.
What matters
- PBT is the cleaner operating read. PBT grew 24.3% while NPAT fell 99.1%; the 123pp gap is explained by the NZD 12.6m discontinued-operation charge, not by underlying trading. The effective tax rate also swung from a prior-year benefit to 15.1%, further distorting NPAT year on year.
- Cash conversion deteriorated sharply. OCF/EBITDA fell from 60.7% to 26.4%. Trade debtors jumped 45.5% to NZD 40.0m (receivable days from ~46 to ~66) and inventories rose 35.5% to NZD 31.3m (inventory days from ~39 to ~52). Pre-lease free cash flow halved to about NZD 4.0m, and the dividend now absorbs roughly 80% of pre-lease FCF versus ~35% last year.
- Balance-sheet direction has turned. The group is no longer net cash, and ROE fell from 9.7% to effectively zero on the reported NPAT. Leverage remains light in absolute terms (net debt/EBITDA ~0.15x), but the direction is clearly weakening.
Expectations
No quantified forward-work figure, order book or medium-term numeric target was disclosed in the extracted release, and no FY23 guidance was given. The interim commentary described forward work as "robust" but did not quantify it. HY22 delivered 53.4% of full-year revenue and 50.8% of full-year EBITDA, so the shape was close to even on the operating line; the extreme second-half NPAT swing (implied H2 NPAT of about -NZD 4.6m) is a function of the discontinued-operation loss rather than trading seasonality. The release therefore supports continued modest revenue and EBITDA growth, but does not support any specific quantified view of FY23.
Quality of result
The earnings improvement on the PBT line is real, but the quality is mixed. EBITDA grew faster than revenue, suggesting some operating leverage, yet the FY22 EBITDA definition is narrower than FY21's (which added back impairment and restructuring), so the 8.2% growth is flattered by definitional change. More importantly, almost all the incremental earnings were consumed by working capital: receivables and inventory together built by more than NZD 20m, and operating cash conversion more than halved. Segment margins are uneven — Europe (13.8%) and New Zealand (~45%) carried the result, while the Americas were loss-making at about -2.5% margin. Capex was nearly halved to NZD 2.3m, which supported pre-lease FCF but is not a sustainable source of cash.
Unresolved
- What is the nature and timing finality of the discontinued operation, and are there residual cash outflows or working-capital unwinds still to come?
- How much of the NZD 20m+ working-capital build reflects genuine project/contract phasing versus collection or inventory-ageing issues, and is there a disclosed unwind path?
- Why are the Americas loss-making, and what is management's plan to fix segment margin dispersion?
- What is the quantified forward-work position entering FY23, and how is FX exposure across five geographies hedged?
- Is the dividend sustainable at current pre-lease FCF coverage if working capital does not release?
This briefing cannot assess management commentary on strategy execution, customer or contract-level detail, or any valuation context, as those were not in the supplied extraction.
Key metrics
| Metric | FY22 | FY21 | Change |
|---|---|---|---|
| Revenue | $221.8m | $216.2m | +2.6% ↑ |
| EBITDA | $23.9m | $22.1m | +8.2% ↑ |
| Net profit after tax | $0.1m | $9.5m | -99.1% ↓ |
| Net cash inflow from operating activities | $6.3m | $13.4m | -53.0% ↓ |
| Final dividend per share | 4.0c | 4.0c | flat |
| Profit before tax | $14.9m | $12.0m | +24.3% ↑ |
| Cash and cash equivalents | $8.5m | $12.2m | -30.7% ↓ |
| Total assets | $206.9m | $194.5m | +6.4% ↑ |
Reference: annolyse.ai/briefings/sct-fy22
Segment breakdown
| Segment | Current revenue | Prior revenue | Current result | Mix shift |
|---|---|---|---|---|
| New Zealand | $50.9m | — | $23.0m | n/a |
| Australia | $56.7m | — | $2.5m | n/a |
| Americas | $52.5m | — | −$1.3m | n/a |
| Europe | $57.9m | — | $8.0m | n/a |
| China | $3.8m | — | $0.3m | n/a |
Reference: annolyse.ai/briefings/sct-fy22
Analytical metrics
| Metric | FY22 | FY21 | Context |
|---|---|---|---|
| PBT growth | +24.4% | — | cleaner earnings measure |
| Effective tax rate | 15.2% | -20.6% | — |
| OCF / EBITDA (cash conversion) | 26.4% | 60.7% | deteriorated |
| FCF pre-lease | $4.0m | $8.9m | −$4.9m |
| FCF / NPAT | n/m | 93.5% | complementary conversion metric |
| Capex % revenue | 1.0% | 2.1% | — |
| Capex | −$2.3m | −$4.5m | +$2.2m |
| Debtor days | 65.8 | 46.4 | +19.4 days |
| Inventory days | 51.6 | 39.0 | +12.6 days |
| Trade debtors | $40.0m | $27.5m | +$12.5m |
| Net debt | $3.5m | −$1.3m | +$4.8m |
| Net debt / EBITDA | 0.15x | -0.06x | Weakening |
| Gross borrowings | $12.0m | $10.9m | +$1.1m |
| Payout ratio vs NPAT | 25.2% | — | — |
| Payout ratio vs FCF pre-lease | 79.7% | — | covered |
| ROE (annualised) | 0.1% | 9.7% | Weakening |
| HY22 share of FY22 revenue | 53.4% | — | Other half was 46.6% |
| HY22 share of FY22 EBITDA | 50.8% | — | Other half was 49.2% |
| HY22 share of FY22 NPAT | n/m | — | Other half was n/m |
| Profit from continuing operations | $12.7m | $9.5m | +$3.1m |
| Discontinued operation after tax | −$12.6m | — | — |
Reference: annolyse.ai/briefings/sct-fy22
This analysis was generated using Annolyse, an AI-powered tool that extracts and analyses NZX company announcements. The underlying data is extracted from official company filings and verified against source documents. 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.