Solvar (SVR) H1 2026 earnings summary

Executive summary

• Commercial lending, led by Bennji, expanded with a loan book exceeding $67 million, replacing New Zealand contributions and targeting further growth; Australian loan book rose 1.7% to $846.6 million since June 2025.

• Sale of the written-off New Zealand loan book for NZ$9.4 million accelerated exit, boosted H1 FY26 profitability, and supported special dividends.

• Regulatory issues with ASIC largely resolved, with most claims dismissed and a penalty hearing pending.

• Strong Christmas demand and commercial lending growth reversed initial H1 FY26 slowdown, driving momentum into early 2026.

Financial highlights

• Normalised NPAT rose 5.8% year-over-year to $20.0 million, with statutory NPAT at $17.8 million; EPS increased 13.5% to 9.3 cents per share.

• Fully franked dividends declared totaled 11.0 cents per share, including special dividends from the NZ asset sale.

• Interest income from continuing operations was $90.7 million, down 2.6% year-over-year; cash collections up nearly 5%.

• Bad debts at 2.9%, below target range, aided by the NZ asset sale; expected to normalize to 3.5–4.5%.

• Originations reached $212.8 million, a 0.6% increase year-over-year.

Outlook and guidance

• FY26 guidance reiterated for normalised NPAT of $36 million, including the one-off NZ loan book sale.

• Bennji loan book expected to double by March and offset NZ wind-down by FY 2027.

• Dividend payout ratio expected to remain high, supported by strong free cash flow and capital position.

• Anticipate continued loan book and origination growth, especially in Bennji and AFS.

• Final stages of New Zealand exit and ongoing regulatory focus anticipated.