Netwealth Group (NWL) H1 2025 earnings summary

Executive summary

• Achieved record growth in Funds Under Administration (FUA), net flows, and profitability for 1H25, with FUA reaching AUD 101.6 billion, up 30.2% year-over-year, and net flows of AUD 8.5 billion, an 80.2% increase.

• Net profit after tax (NPAT) rose 46.6% to AUD 57.6 million, and EBITDA increased 32.8% to AUD 78 million, with a margin of 50.2%.

• Market share expanded to 8.2%, up 100 bps, reflecting strong performance across all client segments and successful integration of recent acquisitions.

• Strategic focus on emerging affluent, high net worth, and institutional markets is delivering results, supported by operational leverage and slower expense growth.

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

Financial highlights

• Revenue rose 26% to AUD 155.4 million, with platform revenue at AUD 150.8 million.

• EBITDA margin improved 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 AUD 70.9 million, up 25.7% year-over-year.

• Transaction revenue grew nearly 50%, now over 14% of platform revenue.

Outlook and guidance

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

• Operational expenses expected to grow by about 5% in the second half, mainly from headcount, and software CapEx to rise by AUD 2 million.

• Regulatory changes from July 2025 will reduce required capital reserves by AUD 17 million.

• Dividend increased by 25% to AUD 0.175 per share, with a payout ratio of about 75%.

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