Nayax Ltd. (NYAX) Cash Flow Statement

The OCF/NI ratio has been consistently above 1.0 since 2024Q3, peaking at 23.94x in 2024Q3 when net income was minimal. This suggests that reported earnings are backed by actual cash generation, with non-cash charges like D&A (averaging ~$6M per quarter) providing a buffer. The 2026Q1 dip in net income to $1.3M still produced $2.8M in operating cash flow, underscoring the stability of cash generation relative to earnings volatility.

The FCF trajectory shows a clear inflection point in 2025Q2, with FCF margins swinging from -7.1% in 2025Q1 to 14.6% in 2025Q3. This improvement aligns with the operating leverage noted in the income statement, as revenue growth outpaced cost increases. However, the 2026Q1 FCF margin contraction to 0.9% warrants monitoring, as it may reflect increased capex (9.0% of revenue) and working capital outflows, potentially signaling a temporary pause in the positive trend.

The capex-to-revenue ratio has been volatile, with a notable spike in 2026Q1 to 9.0%, compared to an average of ~1.5% in 2024. This increase may indicate investment in new product lines like the Volt EV charging line, which could drive future recurring revenue. The low capex in prior quarters suggests that the company's asset-light model historically relied on third-party manufacturing, but the recent uptick implies a strategic pivot toward owning more physical assets, which could pressure near-term FCF but potentially enhance long-term margins.

The working capital line has oscillated between -$6.1M and +$7.2M over the past five quarters, indicating that cash flow is sensitive to changes in receivables, inventory, and payables. The positive contributions in 2025Q3 and 2024Q4 suggest efficient collection or favorable payment terms, while the negative readings in 2025Q1 and 2026Q1 may reflect inventory build-up for new product launches or delayed collections. Investors should monitor whether these swings stabilize as the company scales, as persistent volatility could mask underlying cash generation.

The acquisition-related cash outflows are significant, with cumulative net acquisitions of approximately $78M over the past two years, including $16.9M in 2025Q4. This aligns with the company's strategy of expanding into new verticals like EV charging and retail software. The absence of dividends and buybacks suggests a reinvestment phase, which is consistent with the high growth rate and the need to integrate acquired businesses. However, the sustainability of this M&A-driven growth depends on the successful integration and realization of synergies, which remains to be seen.

The cumulative OCF of $99.9M versus net income of $28.8M indicates that earnings understate cash generation, primarily due to D&A and favorable working capital movements. This suggests that the company's profitability is more robust than GAAP net income implies, as it is generating substantial cash to fund growth. However, the divergence also reflects the lumpy nature of hardware sales and the timing of collections, which investors should consider when forecasting future cash flows. The positive cash conversion supports the view that the business model is becoming self-sustaining, but the reliance on working capital swings warrants caution.