Profit before tax fell 32.5% as a lower tax rate cushioned NPAT to -17.7%

This sits alongside a revenue decline of 3.5% to NZ$3.7b and an EBITDAI decline of 9.5% to NZ$1.1b, pulling the EBITDAI margin to 28.3%, below the company's historical range (mean 32.7%).

Profit before tax fell 32.5% to NZ$347.0m, while NPAT fell a shallower 17.7% to NZ$260.0m because the effective tax rate dropped from 38.5% to 27.4% and a NZ$8.0m discontinued-operation contribution offset part of the continuing-operations decline. Net debt to EBITDAI rose to 1.38x, above the historical range (mean 1.08x), and the full-year dividend stepped down from 27.5 cents to 25 cents per share, with the final dividend at 12.5 cents versus 14 cents prior.

Operating cash flow fell 11% to NZ$680.0m and cash conversion (OCF/EBITDAI) eased to 64.6%, still within Spark's historical range (mean 65.4%).

Transaction with Pacific Equity Partners adds balance-sheet context, with NZ$486m initial cash proceeds, but borrowings and gearing are the direct leverage evidence.

PBT is the cleaner read here: its 32.5% decline is materially worse than the 17.7% NPAT decline, and the gap is explained by the effective tax rate falling from 38.5% to 27.4%, not by an improvement in underlying trading. Investors relying on the NPAT headline alone would understate how much operating performance actually weakened.

Working-capital absorption and leverage are moving together against the company. The NZ$504.5m working-capital movement is unprecedented versus history, debtor days rose to 41.4 days (above the historical range, mean 35.6 days), and net debt to EBITDAI climbed to 1.38x, also above range. Together these reduce balance-sheet flexibility even though headline cash conversion still sits inside its normal band.

Payout has outrun earnings. The payout ratio against NPAT reached 178.6%, above the historical range (mean 109.6%, prior 159.0%), while ROE fell to 17.1% from 19.9%, below its historical range. A dividend funded well above net profit signals the distribution is increasingly reliant on non-operating cash sources rather than current-year earnings.

Absent an explicit forward EBITDAI or dividend target in the supplied data, this result cannot be judged against a company-set bar beyond that qualitative guidance statement.

The half-year shape shows H1 FY25 carried 52.1% of full-year revenue but only 39.8% of EBITDAI and 13.5% of NPAT, meaning profitability was heavily second-half weighted downward. This matters because it confirms the deterioration accelerated through the year rather than being a single-period anomaly, which raises the bar for any assumed stabilisation into FY26.

Spark New Zealand Limited sale adds cash-flow context, with NZ$486m initial cash proceeds, but the filing does not separately reconcile the transaction to the financial movement.

Spark New Zealand Limited sale adds cash-flow context, with NZ$486m initial cash proceeds, but the filing does not separately reconcile the transaction to the financial movement.

Transaction with Pacific Equity Partners (PEP) adds cash-flow context, with NZ$533m disclosed value, but the filing does not separately reconcile the transaction to the financial movement.

Transaction with Pacific Equity Partners (PEP) adds cash-flow context, with NZ$486m initial cash proceeds and NZ$98m deferred cash proceeds, but the filing does not separately reconcile the transaction to the financial movement.

Pre-lease free cash flow of NZ$330.0m sits within Spark's historical range (mean NZ$322.3m), but this was achieved on capex of NZ$429.0m versus NZ$518.0m prior, a 17.2% reduction that lowered capex intensity to 11.5% of revenue from 13.4%. That makes the FCF outcome partly a function of spending less rather than earning more, which is a lower-durability form of cash generation.

Cash conversion at 64.6% is within normal range, but working-capital absorption of NZ$504.5m is unprecedented against history, and the divergence between a "normal" conversion ratio and an abnormal working-capital balance suggests the prior comparable period benefited from an unusually favourable working-capital release that will not recur. Combined with leverage above the historical range and a payout ratio above range, the reported cash and earnings outcomes look less repeatable than the headline figures suggest.

This briefing cannot assess forward guidance numerically because no stated FY26 revenue, EBITDAI, or dividend target was supplied in the extracted data.