MC-4369 — Pacific Padel AGM document review and questions

Prepared: 2026-05-31 14:29 SAST
Sources: AGM Notice, Proxy Form, Pacific Padel financial statements for years ended 31 March 2025 and 31 March 2026

AGM details

• Company: Pacific Padel Limited
• AGM: Thursday 11 June 2026, 17:00 NZT
• SAST equivalent: Thursday 11 June 2026, 07:00 SAST
• Venue: Microsoft Teams / virtual
• Teams link: https://teams.microsoft.com/meet/45189654572771?p=ne33hYxS04sKOUXZve
• Meeting ID: 451 896 545 727 71
• Passcode: Dm6Dm3xT
• Proxy deadline: Monday 8 June 2026, 12:00 NZT = Monday 8 June 2026, 02:00 SAST
• Proxy submission: Arnold Goldstone at arnold@pacificpadel.com, cc nicky@pacificpadel.com

Agenda / resolutions

1. Opt out of GAAP-compliant accounts and accept special-purpose financial reports for the year ending 31 March 2027. Requires at least 95% shareholder approval.
2. Approve annual financial statements for year ended 31 March 2025.
3. Approve annual financial statements for year ended 31 March 2026.
4. Appoint Mark Williams as non-executive director / chair.
5. Appoint Andrew Roberts as non-executive director.
6. Amend constitution to reduce the pre-emptive share-purchase period from two months to 14 days. Special resolution requiring 75% approval.
7. Any other business.

Financial summary

FY2026 vs FY2025

• Trading income increased from NZD 191k to NZD 520k.
• Gross profit improved from NZD 55k to NZD 486k.
• Total expenses increased from NZD 860k to NZD 1.012m.
• EBITDA remained materially negative: NZD (523k) in FY2026 vs NZD (805k) in FY2025.
• Net loss worsened to NZD (1.170m) in FY2026 vs NZD (808k) in FY2025, largely affected by depreciation of NZD 644k in FY2026.
• Cash declined to NZD 114k at 31 Mar 2026 from NZD 285k at 31 Mar 2025.
• Net operating cash outflow was NZD (410k) in FY2026, improved from NZD (822k) in FY2025 but still negative.
• Property, plant and equipment increased to NZD 3.439m from NZD 1.705m; total assets increased to NZD 3.706m.
• Equity increased to NZD 3.277m, supported by NZD 2.436m new share capital in FY2026.
• Current liabilities increased to NZD 429k, including shareholder loans of NZD 254k.

FY2025 context

• FY2025 trading income was NZD 191k, mostly from outdoor padel court sales and small early court-rental/pro-shop activity.
• FY2025 net loss was NZD (808k).
• FY2025 cash and bank balance was NZD 285k, down from NZD 582k in FY2024.
• FY2025 net assets were NZD 2.011m, funded primarily by share capital.

Key observations

1. Business is scaling revenue, but still consuming cash. Revenue growth is encouraging, but operating cash flow and EBITDA remain negative.
2. FY2026 loss is materially larger after depreciation. Depreciation jumped to NZD 644k, reflecting the larger asset base; useful-life assumptions and depreciation policy matter.
3. Cash runway should be clarified. Cash at year-end was only NZD 114k, with negative operating cash flow and ongoing expansion/capex.
4. Shareholder funding is central. FY2026 required NZD 2.436m fresh share capital plus NZD 250k borrowing/shareholder loans.
5. Governance is changing materially. Three non-executive directors resign at the AGM: Arnold Goldstone, Karl Moreton and James Every-Palmer. Mark Williams and Andrew Roberts are proposed as incoming directors.
6. Constitutional change reduces shareholder response time. Moving pre-emptive rights from two months to 14 days may make transfers easier but reduces time for minority shareholders to evaluate and fund a purchase.
7. Unaudited / non-reviewed accounts. The financial statements are special-purpose and explicitly prepared without an audit or review engagement.

Questions / issues to raise

Financial performance and cash runway

• What is the current monthly cash burn after 31 March 2026?
• How many operating venues/courts are live now, and what is current utilisation?
• When does the board expect operating cash flow to turn positive?
• What is the current cash balance and forecast runway as at the AGM date?
• How much additional shareholder funding is expected in FY2027?
• Are further shareholder loans or capital calls likely?

Revenue quality

• How much FY2026 revenue is recurring court rental / memberships vs one-off court/equipment sales?
• What is the gross margin per venue/court after direct operating costs?
• What is the average court utilisation and revenue per court?

Cost base

• What drove the NZD 296k subcontractor cost in FY2026?
• What is the CEO salary arrangement and expected executive compensation going forward?
• Why are directors’ fees NZD 110k while the business remains loss-making and shareholder-funded?
• What legal expenses remain expected after FY2026?

Asset base and depreciation

• What useful lives are used for courts and related infrastructure?
• Why did depreciation increase to NZD 644k in FY2026?
• Are there any impairment indicators on existing sites/courts?

Governance and directors

• Why are three non-executive directors resigning simultaneously?
• What is the transition plan and continuity of governance?
• What exact shares are Mark Williams and Andrew Roberts buying from Matt Karpinski, at what valuation, and was this offered to existing shareholders?
• Will the incoming directors participate in future capital raises on the same terms as other shareholders?

Constitution amendment

• Why is 14 days the right pre-emptive-right period rather than, for example, 30 days?
• How will offshore/minority shareholders be notified and given enough time to decide?
• Does the shorter period prejudice shareholders who need time to arrange funds or evaluate valuation?

GAAP opt-out / reporting

• Why should shareholders accept special-purpose reporting rather than GAAP-compliant accounts while the company is shareholder-funded and growing?
• Can the board commit to more regular management reporting even if GAAP is opted out?
• Will shareholders receive quarterly KPIs: revenue, utilisation, EBITDA, cash, capex, debt/shareholder loans, and capital requirements?

Suggested voting posture

• AGM attendance: Prefer attending virtually if possible, because there are material governance, cash runway, and constitutional issues.
• Proxy: If Elmar cannot attend, submit proxy before 02:00 SAST on 8 June 2026.
• GAAP opt-out: Reasonable only if the board commits to regular useful shareholder reporting; otherwise consider abstaining/asking questions.
• Director appointments: Ask about simultaneous resignations, transition, and share purchase terms before voting yes.
• Constitution amendment: Treat as sensitive for minority-shareholder rights. Ask for rationale and whether 30 days would be a better compromise.

Source notes

• AGM notice: date/time, Teams link, proxy deadline, agenda/resolutions.
• FY2025 and FY2026 special-purpose financial statements: profit/loss, balance sheet, cash flow and related-party notes.