Strong EBITDA Improvement
Underlying EBITDA improved to $6.5 million, an increase of $3.0 million year-on-year, representing an 86% improvement versus the prior corresponding period.
Material Gross Margin Expansion
Group trading gross margin rose 220 basis points to 62.2%, exceeding the 62% target; ANZ trading gross margin dollars were up 10.1% in the half, and trading margin improved 1.3 ppts versus HY25 and 6.4 ppts versus HY24.
ANZ Revenue and Early Q3 Momentum
Australia & New Zealand revenue grew 7.4% for the half; in the first 8 weeks of Q3 ANZ trading gross margin dollars were up 17% and revenue was up 9%, driven by stronger full-price sell-through, improved product mix and tighter promotional discipline.
Positive Operating Cash Flow and Strong Balance Sheet Actions
Generated approximately $10.0–$10.1 million in operating cash flow for the half, reduced inventory by 21%, fully repaid drawn debt, cleaned down covenants for FY26 and extended the bank facility to March 2028; cash on hand was $5.4 million with an undrawn $10 million facility.
Cost Discipline and Lower Operating Cost Base
Cost of doing business reduced to 51% from 54% (down 3 percentage points); overall cost of doing business fell by $2 million year-on-year driven by prior cost-out programs and ongoing cost management.
Improved Customer Metrics and Digital Performance
Customer base stable at ~503,000 with 58% being target high-value customers; website traffic up 9% and Net Promoter Score improved to 74, reflecting stronger customer feedback on product improvements.
U.S. Business Still Contributing Profitably Despite Low Inventory
U.S. delivered a contribution-level profit even with limited inventory investment due to tariff-driven purchasing restraint; gross margin in the U.S. increased by more than 4 percentage points versus prior period.
Investment in AI and Product Decisioning
Launched AI initiatives including a partnership with SeeStone for AI-driven design/buy/allocation (SKU- and location-level predictive models), use of Jasper for marketing content, AI product recommendations and other automation to improve product success rates and operational efficiency.