Table of Contents
What changed
Revenue fell 10.5% to NZ$155.4m and EBITDA fell 27.9% to NZ$21.3m, reflecting 266 unit settlements versus 345 in FY24. Profit before tax dropped 44.8% to NZ$15.2m; NPAT fell a softer 34.4% to NZ$10.3m because the effective tax rate dropped to 31.9% from 42.7%. Operating cash flow rose sharply to NZ$42.3m (FY24: NZ$14.2m), but capex of NZ$75.9m (FY24: NZ$60.5m) left pre-lease free cash flow at negative NZ$33.5m. Cash fell to NZ$20.3m from NZ$41.7m, gross borrowings rose 53.5% to NZ$99.4m, and no dividend was declared against a prior-period 0.55 cps. Segment mix also shifted: Residential dropped from 94% to 84% of revenue while Commercial rose from 6% to 16% but remained EBITDA-negative.
What matters
- PBT is the cleaner read on operating decline. The 10.4pp gap between PBT (-44.8%) and NPAT (-34.4%) growth is explained entirely by a lower effective tax rate, not operations; underlying earnings deterioration is materially worse than the NPAT line suggests.
- Leverage has stepped up sharply. Net debt rose to about NZ$79.2m from NZ$23.1m, taking net debt/EBITDA to roughly 3.7x from 0.8x in a single year. That is the dominant balance-sheet signal in the release, and it reflects capex running well ahead of internal cash generation rather than a trading loss.
- Capital allocation tightened. Passing on the dividend is consistent with negative pre-lease FCF and rising drawn debt, and removes the prior-year 10.4% payout as a form of shareholder return.
Expectations
No quantitative guidance, forward-work balance, or stated targets were disclosed in the supplied materials, so the result cannot be compared against management's own shape. Seasonality context is available via HY25: the first half generated a NZ$0.1m EBITDA loss and a NZ$2.0m net loss, meaning essentially all of FY25's NZ$21.3m EBITDA and NZ$10.3m NPAT were delivered in H2. Relative to that trajectory the full year was second-half-weighted, but the release does not support a view on whether H2 momentum carries into FY26; management commentary only points to a market that "remained" soft.
Quality of result
The earnings result looks lower quality than the NPAT figure alone implies. PBT fell nearly 45%, and the tax rate drop accounts for all of the favourable NPAT variance. The headline operating cash flow number (198% of EBITDA versus 48% in FY24) is genuinely strong, but it is inventory-release-driven — inventories fell NZ$21.6m to NZ$225.7m — rather than earnings-driven, and it still did not cover the investing program. With capex at 48.8% of revenue (FY24: 34.9%) and borrowings up NZ$34.7m, the cash profile is balance-sheet-assisted: the group is funding land/investment-property build-out via debt while unit settlements slow. Commercial contribution to revenue grew, but the segment lost NZ$1.8m at the EBITDA line, so mix shift did not help margin quality.
Unresolved
- What is the current pre-sale book and expected FY26 settlement cadence, given 266 settlements versus 345 a year earlier?
- How much of the NZ$99.4m borrowing facility remains undrawn, and what are covenant headroom and debt-service terms at 3.7x net debt/EBITDA?
- Why has the dividend been paused — is it formally suspended, or simply deferred pending project-delivery cash flows?
- What drove the FY25 effective tax rate down almost 11 percentage points, and is it repeatable?
- When does the Commercial segment turn EBITDA-positive, and what is the embedded yield on the NZ$75.9m FY25 capex?
This briefing cannot assess fair value, since NTA per share, share price and any forward earnings guidance are not disclosed in the supplied data.
Key metrics
| Metric | FY25 | FY24 | Change |
|---|---|---|---|
| Revenue | $155.4m | $173.6m | -10.5% ↓ |
| EBITDA | $21.3m | $29.5m | -27.9% ↓ |
| Net profit after tax | $10.3m | $15.7m | -34.4% ↓ |
| Net cash inflow from operating activities | $42.3m | $14.2m | +198.0% ↑ |
| Declared dividend per share | — | 0.5c | — |
| Operating profit | $16m | $26m | -38.7% ↓ |
| Profit before tax | $15.2m | $27.5m | -44.8% ↓ |
| Cash and cash equivalents | $20.3m | $41.7m | -51.4% ↓ |
| Total assets | $703.9m | $654.1m | +7.6% ↑ |
Segment breakdown
| Segment | Current revenue | Prior revenue | Current result | Mix shift |
|---|---|---|---|---|
| Residential | $130.3m | $162.5m | $21.9m | -9.8pp |
| Retirement | $0.45m | $0.06m | $4.7m | +0.3pp |
| Commercial | $24.7m | $11m | −$1.8m | +9.5pp |
Analytical metrics
| Metric | FY25 | FY24 | Context |
|---|---|---|---|
| PBT growth | -44.8% | — | cleaner earnings measure |
| Effective tax rate | 31.9% | 42.7% | — |
| OCF / EBITDA (cash conversion) | 198.9% | 48.1% | stable |
| FCF pre-lease | −$33.5m | −$46.3m | +$12.8m |
| FCF / NPAT | -325.0% | -294.3% | complementary conversion metric |
| Capex % revenue | 48.8% | 34.9% | — |
| Capex | $75.9m | $60.5m | +$15.3m |
| Net debt | $79.2m | $23.1m | +$56.1m |
| Net debt / EBITDA | 3.72x | 0.78x | Weakening |
| Gross borrowings | $99.4m | $64.8m | +$34.7m |
| Payout ratio vs NPAT | 0.0% | — | — |
| Payout ratio vs FCF pre-lease | 0.0% | — | covered |
| ROE (annualised) | 2.0% | 3.0% | Weakening |
| HY25 share of FY25 revenue | 52.1% | — | Other half was 47.9% |
| HY25 share of FY25 EBITDA | -0.3% | — | Other half was 100.3% |
| HY25 share of FY25 NPAT | -19.4% | — | Other half was 119.4% |
| Profit from continuing operations | $10.3m | $15.7m | −$5.4m |
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.