Oldfields Reports $7.1M Customer Receipts and Positive H1 NPAT Amid Transformation

Strategic Transformation Gains Traction

Oldfields Holdings Limited (ASX: OLH) has marked a pivotal phase in its turnaround journey with its Q2 FY2025 report, revealing tangible progress from the strategic realignment initiated mid-2024. The company’s deliberate exit from the hire and service model on the East Coast has sharpened its operational focus towards sales and distribution, particularly in South and Western Australia, where operations remain stable.

This transition, while incurring costs primarily in Q1 and tapering through Q2, has begun to bear fruit. The company reported positive NPAT and EBITDA for the first half of FY2025, a notable improvement from the prior year, underscoring the effectiveness of its leaner, sales-driven business model.

Financial Performance and Cash Flow Dynamics

Despite a net cash outflow of $2.3 million in Q2, this figure excludes a significant $2.52 million repayment of long-term ATO debt, which was partially financed by a loan facility extension from Pure Asset Management. Customer receipts increased by $360,000 quarter-on-quarter to $7.1 million, with $1 million attributable to transformation-related sales activities. The company also generated over $1 million from the disposal of ex-hire scaffold assets, bolstering working capital and supporting debt reduction efforts.

Oldfields continues to grapple with the residual effects of a product recall initiated prior to Q1, which constrained mobile scaffold inventory and impacted working capital, particularly for paint stock replenishment. However, demand remains robust, and the company anticipates improvements in inventory management and cash flow as these issues resolve.

Capital Raising and Financing Facilities

In Q1 FY2025, Oldfields successfully raised $1.039 million through new share issuances, reflecting proactive efforts to strengthen its balance sheet. Additionally, the company secured $2 million in additional funding from Pure Asset Management at a 9.75% interest rate, with maturity set for June 2025. This funding, secured against company assets, was received in October 2024 and has enhanced financial stability heading into the second half of the fiscal year.

Sales Pipeline and Market Outlook

Oldfields’ sales pipeline remains healthy, with annuity opportunities totaling $7.9 million and one-off deals worth $8.0 million, indicating strong domestic and international demand for its scaffold and paint products. The company expects payments from ex-hire scaffold sales to materialize between January and March 2025, further supporting working capital needs.

Looking forward, Oldfields is confident that its refined sales and distribution framework, combined with ongoing cost efficiencies and a focus on health and safety specializations in South Australia and Western Australia, will sustain momentum through H2 FY2025. The company’s strategic pivot positions it well for sustained profitability, market growth, and long-term value creation.

Challenges and Continuing Risks

While the transformation has yielded encouraging results, Oldfields acknowledges that transition-related expenses and the lingering impact of the product recall continue to affect short-term cash flow. The company’s estimated cash runway is limited, with only 0.19 quarters of funding available based on current operating cash flows, underscoring the importance of converting pipeline opportunities and securing additional capital.

Management remains focused on mitigating these risks through asset sales, cost reductions, and active capital raising, confident that the strengthened operational model and lender support will enable the company to meet its obligations and business objectives.