Netwealth Group (NWL) H1 2025 earnings summary

Executive summary

• Achieved record growth in FUA, net flows, income, and profit for 1H25, with FUA reaching $101.6B, up 30.2% year-over-year, and net flows of $8.5B, an 80.2% increase.

• NPAT rose 46.6% to $57.6M, and EBITDA increased 32.8% to $78.0M, with margin expanding to 50.2%.

• Completed acquisitions of Xeppo and Flux, enhancing data analytics, AI, and technology capabilities.

• Declared fully franked interim dividend of 17.5 cents per share, up 25%.

• Strong operational leverage and strategic focus on expanding into emerging affluent, high net worth, and institutional markets.

Financial highlights

• Total income grew 26.0% to $155.4M; platform revenue up 24.9% to $150.8M.

• EBITDA margin expanded to 50.2%, up 2.6 percentage points from 1H24.

• NPAT margin improved to 37.1%, up 520bps from 1H24.

• Free cash flow before tax reached $70.9M, up 25.7% year-over-year.

• Transaction fee income increased 48.2% to 14.1% of platform revenue.

Outlook and guidance

• Confident outlook with a strong and diversified pipeline, supported by continued investment in technology, people, and product capabilities.

• Operational expenses expected to grow by ~5% in 2H25, mainly from headcount and increased capitalised software investment by ~$2M.

• Regulatory changes from July 2025 will reduce required capital reserves by ~$17M and lower costs for some members.

• Dividend increased by 25% to 17.5 cents per share, with a payout ratio of about 75%.

• FUA as of 18 Feb 2025 was $105.4B, with $1.5B net inflows for 3Q25 to date.