IPH (IPH) H1 2025 earnings summary

Executive summary

• Underlying NPAT rose 20% to $61.0m for HY25, with statutory NPAT up 78% to $37.3m and underlying EBITDA up 11% to $100.5m, despite challenging market conditions and disruptions in Canada.

• Organic growth continued in Australia/NZ for the third consecutive period, and Asian patent filings recovered, up 10% year-over-year.

• Canadian segment became the second largest by revenue, following the acquisition and integration of Bereskin & Parr, with cost synergies above target.

• Interim dividend increased 6% to 17.0 cents per share (20% franked), with a dividend reinvestment plan and commencement of a share buyback program.

• Strong cash generation enabled a $75m share buyback and supported increased shareholder returns.

Financial highlights

• Revenue increased 25.5% year-over-year to $344.3m for HY25; statutory EBITDA up 27% to $95.0m, underlying EBITDA up 11% to $100.5m.

• Underlying diluted EPS increased by 7% to 22.8c; statutory diluted EPS at 13.9c, up from 8.8c.

• Net profit after tax rose 78% to $37.3m, driven by lower non-underlying items and reduced effective tax rate.

• Net debt reduced by 16% to $300m; leverage ratio improved to 1.6x, below the 2x target.

• Cash conversion ratio at 100%, with free cash flow of $54.7m.

Outlook and guidance

• Expecting continued organic growth in ANZ and further recovery in Asia, with positive momentum from increased filings and translation revenue.

• Anticipate margin uplift in Canada as CIPO system issues resolve and Bereskin & Parr synergies materialize.

• Transformation plan to drive efficiency, automation, and AI adoption across the group.

• Cautiously optimistic about macro tailwinds from improving U.S. economy and deglobalization trends.

• Management expects franking credits on dividends to remain in the 15–20% range due to increased offshore earnings.