Nawi Group (NAWI) Q3 2024 earnings summary

Executive summary

• Specializes in non-bank business credit, mainly secured real estate loans, with 82% of the portfolio backed by collateral and 71% focused on residential real estate financing.

• For the nine months ended September 30, 2024, net income rose 2% year-over-year to ₪115 million, with revenues stable at ₪272 million.

• Maintains the highest equity in the sector at ₪863 million (23.6% of assets) as of September 30, 2024, up from ₪799 million year-over-year.

• The loan portfolio grew to ₪3.48 billion, with a focus on large, reputable developers and diversified collateral types.

• Demonstrates resilience, strong governance, high liquidity, and robust risk management amid the ongoing "Iron Swords" war.

Financial highlights

• Total revenue for the first nine months of 2024 was ₪272 million, down 0.8% year-over-year; net profit was ₪115 million, up 2.1%.

• Q3 2024 revenues were ₪96.4 million, down 2.6% from Q3 2023; Q3 net income was ₪38.3 million, down 1.5%.

• Comprehensive income for the period was ₪126 million, a decrease of 15.9% compared to the same period last year.

• Provision for credit losses decreased to ₪10.5 million (0.4% of net loans), compared to ₪13.9 million last year.

• Dividend yield over the past 12 months was 18.89%; total dividends distributed since IPO reached ₪452 million, with ₪19 million to be distributed for Q3 2024.

Outlook and guidance

• Targets for end-2025: credit portfolio of ₪4.3 billion and equity of ₪960 million; for end-2026: credit portfolio of ₪5 billion and equity of ₪1.06 billion.

• Plans to expand secured consumer credit and establish a mortgage financing company.

• Aims to maintain a capital adequacy ratio of at least 18% and expand funding sources via banks and capital markets.