Vista Group EBITDA jumps 38.9% as cloud demand outruns delivery capacity

Revenue rose 10.6% to NZ$77.0m, but EBITDA grew 38.9% to NZ$10.0m, lifting EBITDA margin to 13.0% — the upper edge of the supplied historical range (mean 9.4%, range 3.6%–14.3%). PBT loss narrowed 63.9% to NZ$1.3m and NPAT loss narrowed 37.5% to NZ$1.5m.

Cash performance was the more striking shift. Operating cash flow rose to NZ$14.1m from NZ$3.0m a year earlier, OCF/EBITDA conversion lifted to 141.0% from 41.7%, and the group printed pre-lease free cash flow of NZ$5.1m (against negative NZ$6.2m in HY24). It is described as the second consecutive half of being free cash flow positive.

The balance sheet moved to a small net cash position of roughly NZ$3.1m (net debt/EBITDA -0.31x), gross borrowings fell to NZ$18.8m, and total equity rose 3.6% to NZ$142.7m.

A 10.6% revenue uplift produced a 38.9% EBITDA uplift and a 63.9% improvement in the PBT loss. EBITDA margin of 13.0% sits at the upper edge of the historical range (mean 9.4%), which means the cost base is no longer scaling with revenue and the cloud mix is finally translating into incremental profitability rather than transition cost. Management's commentary that demand exceeds delivery capacity supports a continued bias to revenue and margin upside, provided hiring and onboarding can keep pace.

Cash generation has stepped up, not just earnings. OCF tripled to NZ$14.1m and pre-lease FCF flipped from -NZ$6.2m to +NZ$5.1m on broadly flat capex (NZ$9.0m vs NZ$9.2m). This matters because earnings remain GAAP-negative; cash is the cleanest evidence that the SaaS economics are real rather than purely accounting reclassifications.

The PBT/NPAT growth gap is tax-driven, not operational. Effective tax rate fell to 7.7% from 25.0% (below the 14.1%–25.0% historical range), so PBT growth of 63.9% is the cleaner operating read, and the 26.4 percentage-point gap to NPAT growth of 37.5% reflects tax mechanics on a small loss base rather than any deterioration in underlying earnings.

However, the supplied second-half shape context shows HY24 contributed only 46.4% of FY24 revenue and 33.3% of FY24 EBITDA, so the business is structurally second-half-weighted. Annualising HY25 revenue gives roughly NZ$154m, but a similar H2 weighting would imply meaningfully more — directionally consistent with management's reference to upgraded long-term aspirations and accelerating delivery to meet demand.

What the release does support: continued revenue and margin expansion into H2, and a credible path to a full-year FCF positive print. What it does not support: a quantified FY25 EBITDA margin target, a delivery-capacity timeline, or a clear date for sustained NPAT positivity. The gap matters because the equity story now hinges on H2 follow-through after the H1 margin expansion.

EBITDA margin expansion at 13.0% sits within the supplied historical range, debtor days at 67.8 are at the lower edge of the historical range (mean 111.4 days), and ROE has improved to -1.1% from -1.7%. Cash conversion of 141.0% is classified as within the normal historical range (mean 101.8%), which means the strong cash print is consistent with prior behaviour rather than a one-off working-capital release.

That said, two qualifiers temper the read. First, operating working capital rose NZ$13.8m, including a NZ$10.8m contract assets balance disclosed in the prior period at zero — typically revenue earned but not yet billed, which has not yet converted to cash and could weigh on subsequent periods. Second, the 7.7% effective tax rate (below the 14.1%–25.0% historical range) is unlikely to repeat at this level, so headline NPAT growth flatters operating progress less than PBT growth does.

This briefing cannot assess the quality, contractual structure, or churn profile of the Vista Cloud client cohort underlying the demand commentary.