Table of Contents
What changed
Revenue rose 73.3% to NZD 17.2m and EBITDA more than tripled to NZD 2.1m, both reflecting a full half-year of the Hipgroup/The Store assets acquired in April 2021. Despite that, the continuing-operations result deteriorated: PBT and NPAT both moved from a NZD 0.4m loss to a NZD 0.8m loss. Operating cash flow swung from an outflow of NZD 0.1m to an inflow of NZD 1.1m. Balance-sheet scale expanded sharply — total assets up 41.6% to NZD 59.6m, total liabilities up 73.3% to NZD 40.8m — while gross borrowings rose 60.1% to NZD 14.2m and cash fell to NZD 2.7m. No dividend was declared (HY21: 0.16 cps).
What matters
- EBITDA-to-NPAT divergence. EBITDA grew NZD 1.4m but PBT went backwards by NZD 0.3m, meaning depreciation, amortisation and interest absorbed more than the entire segment gain. With segmental EBITDA margins of ~14.8% in Hospitality and a ~NZD 0.4m Corporate drag, the operating business is scaling but the capital structure is taking most of the lift.
- Leverage and liquidity direction. Net debt is calculated at NZD 11.5m versus NZD 5.2m a year ago. Net debt/EBITDA mathematically improves to 5.4x (from 7.5x) only because EBITDA rose faster than debt; in absolute terms the group is materially more geared and cash has fallen NZD 1.0m to NZD 2.7m.
- Segment concentration. The group is now essentially a single-segment hospitality business (100% of revenue), so earnings quality depends entirely on site-level trading through a period the company itself flags as affected by COVID-19 restrictions.
Expectations
No quantitative targets are disclosed. FY21 is not a clean shape reference because the acquisition transformed the revenue base mid-year; annualising HY22 revenue gives ~NZD 34.3m against a FY21 anchor of NZD 16.1m. Management states trading "exceeded initial expectations" and that approximately NZD 1.0m of cost has been removed, but does not quantify second-half run-rate guidance. The release does support the case that the acquired assets are EBITDA-accretive; it does not yet support a path to positive reported earnings at the current leverage level.
Quality of result
Mixed. The EBITDA uplift is structural (acquired trading), not a one-off, and the swing to positive operating cash flow is a genuine improvement. However, pre-lease free cash flow is still roughly breakeven at -NZD 0.03m after NZD 1.2m of capex (6.8% of revenue, up from 4.2%), so the cash result is not yet self-funding growth. Working capital helped: inventories contributed a NZD 0.8m release and receivables days compressed, both of which are non-repeatable tailwinds. OCF/EBITDA of 53.5% indicates cash conversion below the underlying earnings headline, consistent with interest, lease and tax outflows absorbing part of the EBITDA gain.
Unresolved
- The prior-period revenue base is ambiguous: the extraction compares to NZD 9.9m while the current release narrative compares to NZD 4.9m (continuing operations, current scope). The organic-versus-acquired growth split therefore cannot be isolated from the filing.
- No reconciliation is provided from EBITDA to EBIT or NPAT, so the breakdown between depreciation, amortisation and interest — and specifically how much of the "lost" NZD 1.4m EBITDA gain is interest on acquisition funding — is not directly supportable.
- Trade payables are not disclosed in the extraction, so the durability of the working-capital release cannot be confirmed.
- No forward-work, customer concentration, or FY22 guidance is given, and lease-adjusted free cash flow and NTA per share are not disclosed.
This briefing cannot assess valuation, post-balance-date trading conditions, or the covenant position on the expanded borrowings facility.
Key metrics
| Metric | HY22 | HY21 | Change |
|---|---|---|---|
| Revenue | $17.2m | $9.9m | +73.3% ↑ |
| EBITDA | $2.1m | $0.7m | +207.6% ↑ |
| Net profit after tax | −$0.8m | −$0.4m | -81.4% ↓ |
| Net cash inflow from operating activities | $1.1m | −$0.1m | +889.5% ↑ |
| Declared dividend per share | — | 16.0c | — |
| Profit before tax | −$0.8m | −$0.4m | -81.4% ↓ |
| Cash and cash equivalents | $2.7m | $3.7m | -26.8% ↓ |
| Total assets | $59.6m | $42.1m | +41.6% ↑ |
Reference: annolyse.ai/briefings/svr-hy22
Segment breakdown
| Segment | Current revenue | Prior revenue | Current result | Mix shift |
|---|---|---|---|---|
| Hospitality | $17.2m | — | $2.5m | n/a |
| Corporate | $0m | — | −$0.4m | n/a |
Reference: annolyse.ai/briefings/svr-hy22
Analytical metrics
| Metric | HY22 | HY21 | Context |
|---|---|---|---|
| OCF / EBITDA (cash conversion) | 53.5% | -20.8% | stable |
| FCF pre-lease | −$0.0m | −$0.6m | +$0.5m |
| FCF / NPAT | 4.2% | 135.4% | complementary conversion metric |
| Capex % revenue | 6.8% | 4.2% | — |
| Capex | −$1.2m | −$0.4m | −$0.7m |
| Debtor days | -0.8 | 4.0 | -4.8 days |
| Inventory days | 7.8 | 28.0 | -20.3 days |
| Trade debtors | −$0.1m | $0.2m | −$0.3m |
| Net debt | $11.5m | $5.2m | +$6.3m |
| Net debt / EBITDA | 5.45x | 7.55x | Strengthening |
| Gross borrowings | $14.2m | $8.9m | +$5.3m |
| ROE (annualised) | -4.0% | -2.2% | Weakening |
| HY21 share of FY21 revenue | 61.4% | — | Other half was 38.6% |
| HY21 share of FY21 EBITDA | 69.1% | — | Other half was 30.9% |
| HY21 share of FY21 NPAT | 6.3% | — | Other half was 93.7% |
| Profit from continuing operations | −$0.8m | −$0.4m | −$0.3m |
| Discontinued operation after tax | $0.0m | — | — |
Reference: annolyse.ai/briefings/svr-hy22
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.