Latitude Financial Services Group (LFS) investor relations material

Executive summary

• Cash NPAT rose 39% year-over-year to $64.3 million, with statutory NPAT up 37% to $54.4 million, driven by higher net interest income, disciplined cost control, and robust customer demand.

• Added 148,000 new customers, with card transactions up 7% and purchase volumes up 5% to AUD 3.6 billion.

• Maintained leading market position in unsecured consumer lending, with record personal loan receivables and expanding credit card market share.

• Strategic focus on technology, AI-driven productivity, and operational simplification to drive sustainable growth and efficiency.

• Fully franked interim dividend of 5.50 cents per share declared, up from 5.00 cents per share in the prior period.

Financial highlights

• Gross receivables grew 4% year-over-year to $7.3 billion, with average receivables up 6% to $7.2 billion.

• Total operating income increased 7% YoY to $438 million; risk-adjusted income up 3% to $286 million.

• Net interest margin expanded 27bps to 11.95%, and operating margin rose 20bps YoY to 12.2%.

• Cash cost-to-income ratio improved by 390bps to 41.3%, with cash operating expenses down 1.8% to $180.8 million.

• Dividend yield stands at 12% (17% grossed up), with net tangible assets per security rising to $0.54.

Outlook and guidance

• Expectation of continued profitable receivables growth, though originations may moderate due to softer discretionary spending and macroeconomic pressures.

• Ongoing investments in technology and AI anticipated to further improve operating leverage and productivity.

• Focus remains on maintaining net interest margin and risk-adjusted returns through disciplined pricing, credit, and portfolio management.

• Strong fundamentals and balance sheet flexibility to support ongoing growth and capital returns.