NTAW Cuts $24M Debt, Boosts EBITDA by 87% in 2H FY2025
NTAW Holdings delivered a marked financial turnaround in the second half of FY2025, driven by operational restructuring and cost discipline. The company now sets its sights on consolidating growth and strengthening supplier partnerships in FY2026.
- Significant cost reductions and inventory cuts in 2H FY2025
- Net debt reduced by $24 million, improving financial flexibility
- Leadership changes bolster strategic transformation
- FY2026 focus on core brand growth and supplier partnerships
- Conservative sales growth forecast excluding Dunlop distribution exit
A Turnaround in the Second Half
NTAW Holdings Limited (ASX, NTD), Australia's largest independent tyre and wheel importer, reported a strong recovery in the second half of the 2025 financial year. After a challenging FY2024 and a difficult first half of FY2025, the company implemented substantial operational changes that led to improved financial metrics, including a notable 86.6% increase in operating EBITDA and a 1.8% rise in gross margin percentage.
Key to this turnaround was a rigorous focus on inventory management, which saw stock levels reduced by nearly $30 million, and a disciplined cost-reduction program that shaved over $9 million from operating expenses. These efforts contributed to a healthier balance sheet, with net debt falling by 37% during the period and gearing ratios improving substantially.
Leadership and Strategic Reset
Under the stewardship of newly appointed CEO and Managing Director Warwick Hay, NTAW accelerated its transformation agenda. The leadership team was further strengthened with new appointments in New Zealand and technology management, signaling a commitment to both operational excellence and innovation.
The company also completed a strategic rescaling of its Black Rubber retail operations, closing smaller stores and optimizing larger outlets to enhance profitability. Accreditation of retread plants by major suppliers Goodyear and Michelin adds operational flexibility and efficiency, supporting the group's core capabilities.
Looking Ahead, FY2026 Priorities
Building on the momentum from 2H2025, NTAW's FY2026 strategy centers on consolidating growth in its core wholesale brands across Australia and New Zealand. This includes expanding the successful DWC business model in New Zealand and leveraging partnerships with key suppliers through multiyear agreements aimed at joint market share growth.
Cost discipline remains a priority, with ongoing reviews of warehousing, IT, and shared services to optimize efficiency. The company also plans to continue reducing debt, supported by strong operating cash flows and a cooperative banking relationship with Commonwealth Bank of Australia.
Cautious Optimism Amid Market Challenges
Despite the positive trajectory, NTAW acknowledges a subdued consumer environment and low economic growth in its key markets. The cessation of Dunlop distribution in Australia will impact revenue comparisons, and the company is exploring a potential exit from its South African operations. Nonetheless, the embedded controls and strategic focus position NTAW to navigate these headwinds while pursuing steady, sustainable growth.
Bottom Line?
NTAW’s FY2026 will test whether its operational reset and strategic focus can translate into sustained growth amid a cautious market backdrop.
Questions in the middle?
- How will NTAW’s supplier partnerships evolve to drive volume growth?
- What impact will the potential South Africa exit have on overall performance?
- Can the company maintain cost discipline while pursuing growth initiatives?