Judo Capital (JDO) H1 2025 earnings summary

Executive summary

• Statutory net profit after tax rose 70% to $40.9m for 1H25, driven by strong loan book growth, lower credit impairment charges, and prudent cost management.

• Underlying profit before tax increased 33% to $56.7m, reflecting robust lending, stable costs, and improved operating leverage.

• Lending growth annualised at 18%, more than double sector growth, with gross originations reaching a record $2.3bn in December.

• Regional expansion continued, now in 26 locations with 15 new bankers added, supporting future growth and agri business portfolio expansion.

• Maintained market-leading NPS and high employee engagement.

Financial highlights

• Gross loans and advances grew 9% to $11.6bn, with deposits also up 9% to $9.0bn, and term deposits now 66% of funding.

• Net interest margin (NIM) at 2.81%, with lending margins on new business above 450bps and front-book margin at 4.7%.

• Operating expenses rose 4% to $115.4m, mainly from higher employee costs and technology investments; CTI at 57.4%.

• Impairment expense decreased to $28.8m (0.51% of GLA), benefiting from proactive portfolio management and lower new impairments.

• ROE improved to 5.1% (up 200bps HoH); basic EPS up 68% HoH.

Outlook and guidance

• FY25 guidance targets GLA of $12.7bn–$13.0bn, 15% PBT growth, and low- to mid-teens ROE.

• NIM guidance upgraded to the top end of 2.90%–3.00% for 2H25 and 2.80%–2.90% for FY25, with Jun-25 exit NIM at 3%.

• CTI ratio expected to improve in 2H25 as revenue grows and expense growth moderates.

• Cost of risk guidance unchanged at 50bps of GLA.

• Lending growth to be primarily funded by term deposits.