Australian Finance Group (AFG) H1 2025 earnings summary

Executive summary

• Achieved record settlements and lodgements in Residential and AFG Securities, with total settlement volume up 13% to $32bn compared to 1H24, and a record AFG Securities loan book of $5.1 billion, up 23% from December 2023.

• Net profit after tax (NPAT) rose 6% year-over-year to $15.3m, with gross profit up 4% to $69.2m, and revenue up 11% to $626 million.

• Broker network expanded 7% to over 4,100, now writing 1 in 10 Australian residential mortgages, with technology investments driving broker efficiencies and high NPS (>50).

• Strategic investments and acquisitions, including two equity investments in broker groups and increased ownership in Fintelligence, are expected to deliver $5–7m annualised EBITDA from H2 FY25.

• Strong balance sheet with $185 million in investments and liquid assets, supporting ongoing growth.

Financial highlights

• Revenue increased 11% year-over-year to $626m; EBITDA up 3% to $24.6m; NPAT attributable to members was $15.3 million, up 6.3% year-over-year.

• Distribution earnings grew 8%, driven by higher residential settlements and broker subscriptions; Distribution segment contributed 82% of gross margin and gross profit of $56.5 million, up 5% year-over-year.

• Manufacturing segment achieved a record AFG Securities loan book of $5.1 billion, up 23%, with settlements up 147% and NIM expanded to 114bps in December.

• Fully franked interim dividend of 3.8 cents per share, with a 60% payout ratio and yield of 4.9% for 1H25.

• Well-capitalised balance sheet with $185 million in investments and liquid assets.

Outlook and guidance

• Favourable market conditions, expanding distribution, enhanced technology, and a larger loan book support confidence in future earnings growth.

• Medium-term aspiration for 8% CAGR in residential settlements and AFG Securities book to reach $9bn by FY29.

• Strategic investments in technology and broker groups to drive future earnings growth, with EBITDA uplift of $5–7m annualised expected from recent investments starting in 2H FY25.

• Dividend payout ratio policy to revert to 70–80% after FY25, following a temporary reduction.

• Anticipate broker share of market to rise from 75% toward 80% as branch reductions continue.