Resimac Group (RMC) H2 2024 earnings summary

Executive summary

• FY24 normalized NPAT was AUD 43.1 million, down from AUD 73.7 million in FY23, reflecting NIM compression and lower average Home Loan AUM, with a fully franked dividend of 7 cents per share for the year.

• Statutory NPAT was AUD 34.8 million, compared to AUD 66.5 million in FY23.

• Eight consecutive months of AUM growth since November 2023, signaling a return to growth in the homeloans portfolio.

• Strategic exit from New Zealand origination after years of AUM outflow and reduced profitability; capital to be redeployed into higher-return opportunities.

• Ongoing digital transformation, including a new mobile app and automation improvements, enhancing broker and customer experience.

Financial highlights

• Cost income ratio increased to 53.1% in FY24 from 43.6% in FY23, mainly due to lower AUM and tighter margins, despite a 3.3% reduction in operating expenses.

• Net interest income fell to AUD 159.6 million (from AUD 204.2 million), driven by lower AUM and NIM compression.

• Loan impairment expenses rose significantly year-over-year to AUD 11.6 million, reflecting asset finance portfolio growth and seasoning.

• NPAT declined by AUD 30 million year-over-year, mainly due to lower average homeloan AUM and margin compression.

• Return on equity (normalized) declined to 10.4% from 18.6%.

Outlook and guidance

• Anticipation of lower funding costs and improved NIM in FY25 as market competition eases and RMBS pricing improves.

• Home Loan AUM expected to continue growing, supported by low discharges and increasing settlements.

• Asset Finance growth to be pursued through new channels, products, and cautious expansion.

• Continued focus on digital transformation and operational efficiency to support scalable growth and broker experience.

• Commitment to disciplined capital deployment and return on capital requirements for new opportunities.