Qube Holdings Limited

Qube reported group underlying EBITDA growth of 9.8% year over year and underlying NPATA of $157.5 million, up 10.1% from the first half of FY25. EBITDA margins improved from 10.0% to 10.6% excluding grain trading, while net finance costs increased by $9 million versus the prior period. The company also reported two material nonunderlying items in statutory results: a $101.5 million pretax gain on the beverage property sale and a $37.3 million reversal of an onerous contract provision. Gross capex was $216 million, proceeds from divestments were $163 million, and net capex was $53 million. Net debt decreased by circa $51 million, cash conversion excluding grain trading working capital was 71%, liquidity was over $1.1 billion, and gearing was 31.6%. For FY26, management expects solid NPATA and EPSA growth of 6% to 10%, with positive outlooks for operating earnings and associates.

Paul Digney framed the half as a solid, record result supported by organic growth, acquisitions, and diversification across businesses. He highlighted stronger-than-expected performance in New Zealand, Patrick, Agri and Energy, while noting some offsets from contract timing, renewable project delays, and softer ancillary services in parts of the portfolio. He also emphasized that the MAM-led $5.20-per-share scheme underscores the value of Qube’s strategy and that the business is positioned to keep growing during the transaction process.

Mark Wratten said the operating division drove the 9.8% increase in underlying EBITDA and pointed to margin improvement from 10.0% to 10.6% excluding grain trading. He noted net finance costs were up $9 million due to higher average debt and no interest income on repaid shareholder loans to Patrick, while NPATA reached $157.5 million. On capital, he said gross capex was $216 million, including $35 million on two acquisitions, $88 million on growth assets, $88 million on replacement capex and $5 million on Moorebank rail terminals; proceeds of $163 million left net capex at $53 million. He also said net debt fell by about $51 million, liquidity was over $1.1 billion, average debt maturity was 4.4 years, and gearing was 31.6%, with an interim dividend of $0.0535 per share fully franked.

Analysts focused heavily on grain trading, ports and bulk margins, capex guidance, the potential special dividend, and the takeover approvals timeline. Management said grain trading has been effective at pushing volume through the network, but margins are constrained by lower pricing and FX; on Ports and Bulk, they cited mix issues, wind project timing, setup costs, and a delayed Iluka Balranald project as reasons for a softer outlook. On capital returns, Mark Wratten said Qube can pay up to $0.40 of dividends before completion, including the interim dividend, and is seeking an ATO class ruling to support franking-credit use. On the scheme, Paul Digney said ACCC and FIRB are the key approvals, with a possible 4 to 6 month timetable, and he did not expect merger-like competition issues because this is an ownership change, not an operational merger.