Helia Group (HLI) H1 2025 earnings summary

Executive summary

• Statutory net profit after tax rose 38% year-over-year to $134 million, driven by low claims and robust investment returns, with underlying NPAT at $126 million.

• Insurance revenue declined 6% year-over-year to $182 million, reflecting a shrinking enforced portfolio, but GWP increased 28% due to higher market share and lending volumes.

• Fully franked interim ordinary dividend of $0.16 per share and unfranked special dividend of $0.27 per share declared, with capital returns exceeding statutory NPAT.

• Major contracts with CBA and ING, representing over 60% of premiums, will not be renewed from 2026, prompting a comprehensive business review.

• Ongoing strategic review to address operational challenges and adapt to market and policy changes.

Financial highlights

• Net profit after tax of $134 million, up 38% year-over-year, with underlying NPAT at $126 million.

• Insurance revenue was $182 million, down 6% year-over-year.

• Gross written premium (GWP) up 28% year-over-year, outperforming a flat industry.

• Negative total claims incurred of $27 million, reflecting favorable claims experience and reserve releases.

• Net investment return surged to 7.3% p.a., with investment revenue up significantly.

Outlook and guidance

• Full year insurance revenue expected between $350 million and $390 million, with guidance revised up.

• Full year claims expected to remain negative and well below historical averages.

• Longer-term loss ratio expected to average around 30% across cycles.

• Revenue from in-force CBA and ING policies will be recognized over up to 15 years, but new business from these clients will cease in 2026.

• Board reviewing strategic options in response to contract losses and Home Guarantee Scheme changes.