Table of Contents
What changed
Revenue rose 180.2% to $52.4m and EBITDA swung from -$27.6m to +$5.2m. The PBT/NPAT loss narrowed 93.8% to -$2.3m, with no tax distortion (effective tax rate was 0% in FY23 versus 1.2% in FY22, so PBT and NPAT moved in lockstep). Operating cash flow swung by $36.0m to +$6.1m.
The balance sheet moved in the opposite direction. Cash fell from $92.6m to zero, gross borrowings stood at $11.35m (down from $13.4m per the interim file), total assets halved to $56.4m, and equity collapsed 82.8% to $17.3m. Only a single reportable segment (Hospitality) is disclosed, at a ~15.0% EBITDA margin.
What matters
- The operating turnaround looks real but the group is now a different business. FY22 carried a large loss against a tiny revenue base and a cash-rich balance sheet; FY23 shows a scaled hospitality operation generating $5.2m EBITDA on $52.4m revenue. The comparability of the two years is limited.
- Capital structure has fundamentally reset. Moving from $92.6m net cash to roughly $11.4m net debt (about 2.18x FY23 EBITDA) while equity fell by $83.2m is the dominant balance-sheet event of the year. The release flags $3.6m of debt repayment, but cash burn and equity compression are much larger than the loss alone explains.
- No quantified forward target or forward-work book was provided, so the read on FY24 rests on the shape of the second half and the durability of the ~15% segment margin rather than on guidance.
Expectations
No stated FY23 earnings target or multi-year target was supplied, though management says EBITDA of $5.2m was "within the guidance range announced in January 2023." Against the interim shape, FY23 was clearly second-half weighted: HY23 contributed only 39.5% of full-year revenue, 25.9% of full-year EBITDA, and the NPAT loss narrowed from -$2.1m at the half to -$2.3m full year, implying a near break-even second half (-$0.2m). The implied H2 EBITDA of $3.9m on $31.7m revenue is a step up in both scale and margin from H1, which sets a higher bar for FY24 if H2 is to be treated as the new run rate.
Quality of result
The underlying cash quality is the more encouraging signal: OCF of $6.1m exceeded EBITDA (conversion of 116.2%), capex fell to $4.3m (8.1% of revenue versus 24.6% prior), and pre-lease FCF was positive at $1.8m. Receivables days compressed from 95.9 to 3.2, consistent with a mix shift to point-of-sale hospitality revenue rather than an aggressive working-capital release.
Two caveats temper the quality read. First, EBITDA is presented as a non-GAAP figure with an asterisk and management references "one-off restructuring and interest costs" in explaining NPAT, but no reconciliation bridge is supplied in the excerpt. Second, pre-lease FCF of $1.8m is small relative to $11.35m of borrowings, so deleveraging capacity from operations alone is modest at the current run rate.
Unresolved
- What drove the $92.6m reduction in cash and the $83.2m fall in equity? A move from a cash-rich prior structure into an operating hospitality group of this scale implies acquisitions, distributions, write-downs, or a capital return that are not quantified in the supplied material.
- How large were the "one-off restructuring and interest costs," and what is the clean underlying NPAT figure management is pointing to (the release mentions an adjusted -$0.6m versus statutory -$2.3m)?
- Is the H2 EBITDA step-up (implied $3.9m) a sustainable run rate or venue-opening timing, given the interim file references new venues opening in November trading "above expectations"?
- With cash at zero and $11.35m of borrowings, what is the committed facility headroom and covenant position?
This briefing cannot assess venue-level performance, the composition of the equity decline, valuation (no share price or market cap supplied), or the credit facility terms behind the $11.35m of borrowings.
Key metrics
| Metric | FY23 | FY22 | Change |
|---|---|---|---|
| Revenue | $52.4m | $18.7m | +180.2% ↑ |
| EBITDA | $5.2m | −$27.6m | +118.9% ↑ |
| Net profit after tax | −$2.3m | −$38.1m | +93.9% ↑ |
| Net cash inflow from operating activities | $6.1m | −$30m | +120.3% ↑ |
| Final dividend per share | −13.0c | — | — |
| Profit before tax | −$2.3m | −$37.7m | +93.8% ↑ |
| Cash and cash equivalents | $0m | $92.6m | -100.0% ↓ |
| Total assets | $56.4m | $122.6m | -54.0% ↓ |
Segment breakdown
| Segment | Current revenue | Prior revenue | Current result | Mix shift |
|---|---|---|---|---|
| Hospitality | $52.4m | — | $7.9m | n/a |
Analytical metrics
| Metric | FY23 | FY22 | Context |
|---|---|---|---|
| OCF / EBITDA (cash conversion) | 116.2% | 108.4% | stable |
| FCF pre-lease | $1.8m | −$34.6m | +$36.4m |
| FCF / NPAT | -76.9% | 90.6% | complementary conversion metric |
| Capex % revenue | 8.2% | 24.6% | — |
| Capex | −$4.3m | −$4.6m | +$0.33m |
| Debtor days | 3.2 | 95.9 | -92.7 days |
| Inventory days | 7.1 | — | — |
| Operating working capital | $1.5m | — | — |
| Trade debtors | $0.46m | $4.9m | −$4.5m |
| Net debt | $11.4m | — | — |
| Net debt / EBITDA | 2.18x | — | Weakening |
| Gross borrowings | $11.4m | — | — |
| ROE (annualised) | -13.5% | -37.9% | Strengthening |
| HY23 share of FY23 revenue | 39.5% | — | Other half was 60.5% |
| HY23 share of FY23 EBITDA | 25.9% | — | Other half was 74.1% |
| HY23 share of FY23 NPAT | 91.3% | — | Other half was 8.7% |
| Profit from continuing operations | −$2.3m | — | — |
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.