Cash Converters International (CCV) H2 2024 earnings summary

Executive summary

• Revenue increased 26% year-over-year to $382.6m, driven by organic growth and franchise store acquisitions in Australia, UK, and New Zealand.

• Operating EBITDA rose 21% to $69.1m, with cost inflation managed and operating leverage maintained.

• Statutory profit for FY2024 was just over AUD 17 million, rebounding from a prior year loss, despite regulatory changes impacting small loan products.

• Transitioned away from small credit contracts, diversifying the loan book and expanding into new product lines.

• 50 franchise stores acquired in FY2024, with a strong pipeline for further acquisitions in core markets.

Financial highlights

• Gross loan book expanded 6% year-over-year to $288.0m, with principal advanced up 8%.

• Net loss rate declined to 8% from historical levels of 11%-12%, attributed to strong employment and improved collections.

• Cash and cash equivalents ended at $56.2m after funding loan book growth and acquisitions.

• 8th consecutive half-year dividend declared, totaling AUD 50 million returned to shareholders over four years.

• Invested AUD 24 million in business combinations, funded without taking on corporate debt.

Outlook and guidance

• Focused on growing company-owned and franchise store networks in the U.K. and Australia, with a pipeline of 39 stores in Australia and 143 in the U.K. under consideration.

• Expect continued loan book growth, especially in new products, while maintaining disciplined capital deployment.

• Securitization/financing facility increased to $200m, supporting further lending expansion.

• Net loss rates expected to remain stable, supported by advanced credit models.

• No anticipated change in dividend policy.