TZ Limited has amended its Appendix 4C for the December 2025 quarter, clarifying cash flow details and signalling improved operating cash flows ahead. The company also updates its funding arrangements, including loan repayments and a proposed trade finance facility.
- Amended Appendix 4C corrects prior cash flow disclosures
- AU$350,000 significant customer receipt received post-quarter
- Net operating cash outflows expected to reduce in second half FY26
- Causeway Finance loan repayment dates revised
- Trade finance/factoring facility remains under negotiation
Clarifying the Cash Flow Picture
TZ Limited (ASX: TZL) has released an amended Appendix 4C for the quarter ended 31 December 2025, addressing several corrections and clarifications to its previously lodged cash flow report. The revisions include the disclosure of a significant AU$350,000 customer payment that was contractually due before quarter-end but received after, in January 2026. This timing nuance materially impacted the reported net operating cash outflows for the period.
Outlook for Operating Cash Flows
The company emphasises that the current level of net operating cash outflows is not expected to persist. TZL anticipates improved cash flow performance in the second half of the 2026 financial year, driven by several factors: the cyclical nature of its SaaS subscription revenues, progressing contracted revenues in installation and commissioning phases, and increased sales activity in its Smart Locker and Data Centre Security divisions. Additionally, the company is implementing tighter working capital management, including the potential introduction of a trade finance or factoring facility, alongside ongoing cost control measures.
Funding and Debt Refinancing Updates
On the financing front, TZL clarified the repayment schedule of its AU$4.75 million Causeway Finance facility, correcting the repayment date for AU$2.75 million to 27 February 2026, with the remaining AU$2 million to be repaid in quarterly instalments starting March 2026. The facility carries a 12% interest rate and is secured against company assets. The company also maintains a secured AU$1.5 million debenture facility with its largest shareholder, First Samuel Limited, maturing 30 June 2026.
Trade Finance Facility in Progress
While the proposed trade finance or factoring facility remains unfinalised, TZL is actively engaging with multiple lenders. The company notes that a factoring facility is preferred but requires meeting minimum annual volume criteria. Alternative trade finance options are being considered, pending due diligence. The Board intends to evaluate all offers once available to select the most advantageous funding solution.
Navigating Volatility and Future Prospects
TZL’s cash flow remains volatile due to the uneven timing of large projects and subscription revenue inflows. However, the company expresses confidence in its ability to continue operations and meet business objectives, supported by contracted revenues, expected cash flow improvements, and ongoing funding initiatives. The amended Appendix 4C aims to provide a more accurate and transparent view of the company’s financial position for investors and stakeholders.
Bottom Line?
TZ Limited’s amended cash flow report and funding updates set the stage for a potentially steadier financial footing in the latter half of FY26.
Questions in the middle?
- Will TZ Limited finalise and secure the proposed trade finance or factoring facility soon?
- How will the timing of large project revenues impact cash flow volatility going forward?
- What are the implications of the upcoming loan repayments on TZL’s liquidity and capital structure?