Meritz Financial (138040) Q1 2025 earnings summary

Executive summary

• Consolidated net profit for Q1 2025 was KRW 620.8 billion, up 5% year-over-year, driven by stable interest income and improved investment performance.

• Total assets reached KRW 119.7 trillion, up 3.6% year-over-year, while shareholder equity decreased 1.4% to KRW 10.8 trillion due to dividends and treasury stock acquisitions.

• ROE remained high at 24.6%, among the industry's best, and EPS rose 10.1% year-over-year to KRW 3,353.

• The group maintained strong capital adequacy, with a capital ratio of 186.4% and a debt ratio of 46.7%.

• Shareholder returns remained a priority, with significant share buybacks and a total shareholder return rate of 194.4% since 2023.

Financial highlights

• Consolidated net profit for Q1 2025 was KRW 620.8 billion, up 5% year-over-year.

• EPS reached KRW 3,353, up 10.1% year-over-year; BPS at KRW 54,536, up 0.1% from year-end.

• Net interest income grew 10% year-over-year to KRW 558 billion, while insurance income declined 29% year-over-year.

• Operating profit for Q1 2025 was KRW 721.7 billion.

• Total shareholder return over two years was 152.2%.

Outlook and guidance

• The group will maintain its mid-term shareholder return policy, targeting a payout of at least 50% of consolidated net profit through 2025.

• Shareholder return policy will continue to focus on share buybacks and cancellations, as buyback yield exceeds required rate of return.

• Capital allocation beyond 2026 will prioritize shareholder value based on market and profitability conditions.