COG Financial Services (COG) H1 2025 earnings summary

Executive summary

• Revenue for 1H25 rose 7% year-over-year to $251.0m, driven by organic growth in Novated Leasing and asset management, partially offset by lower contributions from insurance broking and TL Commercial run-off.

• NPATA attributable to shareholders was $11.8m, down 6% year-over-year, but up 3% on an adjusted basis excluding TL Commercial's diminished contribution.

• EBITDA to shareholders was $18.6m, a 1% decrease year-over-year, with EBITDA margin contracting to 11.3% from 12.7% due to compressed lending margins and increased investment in people and technology.

• EPSA declined 10% year-over-year to 5.98cps; interim dividend declared at 3.0cps (fully franked), with payout ratio reduced to 51.2% and DRP suspended for the interim dividend.

• Net asset position at 31 December 2024 was $200.6m, compared to $203.6m at 30 June 2024.

Financial highlights

• Net assets financed reached $4.2bn in 1H25, maintaining strong volumes despite the end of the instant tax write-off incentive.

• Statutory NPAT attributable to members was $8.5m, down 7% year-over-year.

• Cash and cash equivalents at 31 Dec 2024 were $135.2m, with unrestricted cash attributable to members at $62.8m.

• Capex for 1H25 was $4.2m, mainly for fit-out, leasehold improvements, and IT systems.

• Net cash inflow from operating activities was $32.2m, up from $25.0m year-over-year.

Outlook and guidance

• Novated Leasing segment expected to continue strong organic growth, supported by ongoing FBT incentives for electric vehicles and partner employee uptake.

• Focus remains on strategic acquisitions, investment in broker aggregation, cyber security, retail fixed income products, and expanding asset management and lending into mid-prime products.

• Strong balance sheet and unrestricted cash position to support future earnings growth and acquisitions.