PBT up 36.2% and cash conversion at 91.8% as capex more than doubled

The like-for-like comparison is not clean because the prior comparable period included the Cibus catering acquisition mid-year, so FY26 captures a full year of contribution against a partial-year base.

Underlying EBITDA reached NZ$27.4m and operating cash flow lifted 25.3% to NZ$25.1m. OCF/EBITDA conversion landed at 91.8%, which is above Annolyse's historical baseline (3-period mean 60.4%, range 28.4%–85.5%).

Capex stepped up to NZ$16.1m, 8.0% of revenue, against NZ$6.4m (3.6%) the prior year. Net debt of NZ$68.7m was little changed and net debt to EBITDA of 2.51x sits below the historical mean of 4.46x. Full-year dividends totalled 2.2cps versus 1.45cps in FY25, on a company-disclosed payout ratio of 49% of AFFO.

First, margin expansion ran above the company's recent historical band: EBITDA margin 13.7% (mean 11.8%, range 9.7%–13.4%), PBT margin 7.1% (mean 2.0%) and NPAT margin 4.7% (mean -0.8%). For an aged-care operator, this kind of step-up usually reflects EBITDAR-per-bed gains and central-cost leverage, both of which the release flags. The question is whether occupancy and EBITDAR run-rate hold.

Second, capex more than doubled to NZ$16.1m, lifting capital intensity from 3.6% to 8.0% of revenue. The release describes the strategy as "capital-light", which sits in tension with the size of the increase. Investors will want to know which of property, plant and village developments is driving the step-up and whether FY27 capex stays at this level.

Third, the half-year shape is uneven: H1 generated 66.9% of full-year NPAT, so H2 NPAT roughly halved from NZ$6.3m to an implied NZ$3.1m. EBITDA only slipped from 54.5% to 45.5% of the full year, suggesting the H2 weakness is concentrated below the operating line — depreciation, financing or tax timing — rather than at the trading level.

The H1/H2 shape is the most concrete forward signal: annualising H2 NPAT of NZ$3.1m would imply a much lower base than the FY26 NZ$9.5m print, while annualising H2 EBITDA of NZ$12.5m would still leave underlying earnings comfortably above the historical margin mean. Until the H2 step-down is explained, the release supports a strong FY26 print but not yet a confident FY27 trajectory.

The effective tax rate was steady at 29.9% versus 29.4%, so NPAT growth (35.7%) tracks PBT growth (36.2%) almost one-for-one. Operating working-capital movement was only NZ$0.1m, within the supplied historical range, so the 91.8% cash conversion is not a working-capital release. Receivable days of 21.2 (versus the 27.4-day historical mean) reflect tight billing discipline rather than a one-off timing benefit.

Three caveats temper the read. The prior-comparable Cibus acquisition inflates revenue growth against a partial-year base, so the 14.2% headline is not a clean like-for-like. Pre-lease free cash flow of NZ$9.0m is within the historical range despite materially higher OCF, because capex absorbed most of the operating cash gain. And the second-half NPAT step-down means the full-year margin print is being supported by a stronger first half.

This briefing cannot assess bed-level occupancy, average resident-day rates or EBITDAR-per-bed trajectory beyond the headline figure, none of which are quantified in the supplied excerpts.