Qube (QUB) H1 2025 earnings summary

Executive summary

• Underlying revenue for H1 FY25 rose 28.4% to $2.09 billion, with underlying EBITA up 14.0% to $178.8 million and NPATA up 1.3% to $143.0 million, driven by organic growth, acquisitions, and strong agri activities despite headwinds in automotive and industrial action.

• Statutory NPAT declined 5.9% to $105.7 million, impacted by lease accounting changes and discontinued operations.

• Interim dividend increased 2.5% to 4.1 cents per share, fully franked, with a payout ratio of 51% of underlying EPSA.

• Investment grade credit ratings achieved and $600 million in senior unsecured notes issued, with $297.1 million in asset sales contracted.

• Diversification and organic growth offset operational disruptions, including industrial action and mine closures.

Financial highlights

• Underlying EBITA margin (ex grain trading) improved to 11.2%, with group ROACE (ex MLP rail terminals) steady at 10.5%.

• EBITDA margin declined to 14.3% from 16.0% due to high-revenue, low-margin grain trading.

• Cash and available undrawn debt facilities at $1.15 billion; net debt at $1.6 billion; leverage ratio 32.5%.

• Maintenance capex at 94% of depreciation; gross capex $341.7 million, mainly for property, rolling stock, and mobile assets.

• Cash conversion impacted by grain trading working capital; excluding this, cash conversion was ~79%.

Outlook and guidance

• FY25 underlying NPATA and EPSA expected to be at least 5% above FY24, driven by strong Logistics & Infrastructure and Ports & Bulk performance.

• Gross capex for FY25 forecast at $800–$850 million, with maintenance capex at 85–90% of depreciation.

• Net interest expense for FY25 expected to be $20–$25 million above FY24, mainly due to higher debt and delayed MIRRAT acquisition.

• Associates forecast an overall NPATA decline of $6–8 million, mainly due to MITCO losses.

• Outlook assumes no material adverse changes in market, economic, or industrial conditions.