The Savour Group hospitality chain added a bright sheen to Moa Group's first-half result with positive operating earnings, albeit a little softer than the brewer had flagged earlier this year.
Moa's hospitality arm reported earnings before interest, tax, depreciation and amortisation of $1.5 million in the six months ended September30 on revenue of $11.3m, more than making up for the brewing arm's $774,000 ebitda loss on revenue of $6.7m.
The craft-beer maker bought Savour in April for $13 million upfront in cash and shares, with a second $4.9m tranche due to be paid next April. Moa's management believe a further $1.9m - of a further $3m payment conditional on performance targets being met - will be paid.
At the time of the deal, Moa said Savour would add $26m of revenue and contribute $3.6m to earnings in the year ending March 2020.
The group reported a net loss of $1.6m in the six months ended September 30, compared to a loss of $1.4m a year earlier. That included depreciation of $1.2m, an increase due to new accounting standards, and $180,000 of acquisition and restructuring costs.
Excluding those one-off costs, group ebitda was $333,000 compared to an ebitda loss of $1.2m a year earlier.
"We have been through significant change both operationally and strategically across the business during the period, and it is great to see results from that starting to come to fruition," executive chair Geoff Ross said in a statement.
The company noted that the second half – covering the Christmas and New Year period and summer months – was typically stronger for both hospitality and brewing.
Since balance date, Moa settled its $3.8m acquisition of the Non Solo Pizza restaurant in Auckland's Parnell suburb.
Moa ended the period in overdraft with a negative cash position of $1m, largely due to the Savour acquisition. Its operating cash flow improved to an outflow of $832,000 in the half from $2.6m a year earlier.
Moa shares fell 3.2 per cent to 30 cents and have dropped 40.5 per cent so far this year.
