Key Highlights (H1 FY2025):
- US collections up 12% year-on-year.
- Consumer lending book grew 5% to a record $465 million.
- Underlying Net Profit After Tax (NPAT) surged 32% to $44.1 million.
Credit Corp Group Limited (ASX: CCP) has reported a strong first half of FY2025, with robust earnings growth driven by improved US operations and consumer lending performance.
US Market Performance
Despite two years of reduced investment, US collections rose 12%, with labour productivity improving 28%. While Credit Corp did not expand its debt purchasing pipeline in H1, it expects to invest $150 million in the US over the full year, targeting credit card charge-offs that meet its return criteria.
CEO Thomas Beregi highlighted that further operational gains would allow for increased investment, reinforcing Credit Corp’s financial and operational strength.
Consumer Lending Momentum
- Lending segment NPAT soared 79% to $24.9 million, fueled by prior-year loan book expansion.
- While new lending volumes softened as post-COVID re-leveraging slowed, the loan book still grew over the half-year, setting the stage for record lending NPAT in FY2025.
- The Wallet Wizard product remains the primary earnings driver, but Wizit digital credit card (launching late FY2025) is expected to expand market reach.
Australian & NZ Debt Buying Stabilises
- The debt buying book saw NPAT decline 10%, but earnings are expected to stabilize.
- Market sale volumes remain low, with no immediate signs of recovery, though further downside is limited.
Dividend & FY2025 Outlook
- Interim dividend declared at 32 cents per share (≈50% payout ratio).
- Full-year guidance reaffirmed, with NPAT expected between $90–$100 million and EPS in the 132–147 cents range.
With strong H1 results and a promising pipeline in both lending and US operations, Credit Corp remains on track for significant FY25 earnings growth.
