NPAT fell 36% on 2% revenue growth as leverage hit 4.2x EBITDA

Underlying EBITDA was $113.3m, down 5% on management's measure. The decline is operating, not tax-driven — the effective tax rate was 28.2% versus 29.1% prior, and PBT and NPAT moved within 0.8 percentage points of each other.

The board cut the interim dividend 44.4% to 2.5 cents per share. Gross borrowings rose 15.9% to $526.0m, taking net debt to $477.3m and net debt to EBITDA to 4.21x on the underlying measure. ROE fell from 13.8% to 8.0%. Operating cash inflow of $24.3m reversed a $78.8m outflow in HY24, but the swing reflects a working-capital base effect rather than improved earnings quality.

Management flagged a 4% decrease in sale-of-goods revenue and lower margins on ex-rental and retail RV sales. Inventories climbed 18.7% to $237.2m and inventory days lengthened from 81.0 to 94.2, an increase of 13 days. This matters because the inventory build sits on the balance sheet ahead of any RV market recovery, and discounting risk on aged stock is rising.

Leverage is the binding constraint. Net debt of $477.3m on underlying EBITDA of $113.3m gives 4.2x. Combined with rising inventories, an interim dividend cut to 2.5cps, and capex up from $4.2m to $17.4m, balance-sheet capacity is tight. The dividend reduction reads as a deliberate cash-preservation choice rather than a one-off signal.

Segment economics are uneven. Australia, the largest segment at 41% of revenue, generated only $14.3m of result on $189.1m of revenue (12.2% margin). North America delivered $21.2m on $115.2m (14.1%) and Tourism $5.2m on $19.3m. UK/Ireland is at break-even. Group reliance on the Australian rentals/sales/manufacturing footprint at thin margins amplifies sensitivity to RV demand.

The company's own historical shape is unusual: HY24 produced $39.7m of NPAT against an FY24 result of just $38.0m, implying a $1.7m loss in H2 FY24. Revenue, by contrast, was second-half-weighted, with HY24 representing 44.6% of full-year revenue.

The HY25 print of $25.3m therefore sits well below the prior first-half level, and the H2 shape is hard to read from precedent: revenue could lift seasonally while the earnings tail remains exposed to RV-sales clearance pressure. Without a target or H2 guidance, the release does not support a confident full-year earnings projection.

HY24's $78.8m operating outflow was unusually negative; HY25's $24.3m inflow translates to OCF/EBITDA of just 21.4%, which is weak in absolute terms. After capex of $17.4m, FCF pre-lease was $6.9m, equal to 27.3% of NPAT. The interim dividend absorbs 79.5% of that FCF, so cover is thin even though it is technically covered.

Working capital is the swing factor. Trade debtors fell 21.8% to $50.1m (receivable days down to 19.9), but that improvement was more than offset by the $37.4m inventory build. Operating working capital rose by $23.4m to $287.3m. Capex intensity also stepped up sharply to 3.8% of revenue from 0.9%. Combined, these movements suggest the underlying cash-generation profile of the business is materially weaker than the 130.8% headline OCF swing implies, and that further inventory unwind is needed before reported cash quality stabilises.

This briefing cannot assess underlying RV market demand trajectory or the resale value embedded in the larger inventory and fleet position.