Sequoia Financial Group (SEQ) H1 2025 earnings summary

Executive summary

• Net profit after tax from continuing operations rose 137% year-over-year to $3.6m, despite a 3.5% decrease in operating revenue to $60.6m as the group streamlined from four to two divisions and divested four non-core businesses.

• Management invested in technology and restructured operations, resulting in improved efficiency, profitability, and annualized salary savings of $1.5m with a staff reduction of over 10%.

• Leadership changes included a new Chair and executive team enhancements to drive future growth.

• Declared a fully franked interim dividend of 2.0 cents per share, with a payout ratio of 70%, above the long-term target of 40%-60%.

• Share buyback reduced issued capital by 5%.

Financial highlights

• Revenue for continuing businesses was $60.6m, down 3.5% year-over-year, mainly due to divestments and lower structured product sales.

• Normalized EBITDA fell 14.6% to $2.7m, reflecting costs of business simplification.

• Net profit after tax from continuing operations rose 137% to $3.6m.

• Cash flow from continuing operations increased 62% to $3.4m, with cash conversion to operating profit at 126%.

• Cash balance at period end was $10.9m, with no bank debt and net assets of $51.5m.

Outlook and guidance

• Expectation for a stronger second half, supported by early performance and historical trends.

• Dividend payout ratio targeted to move from 20%-50% to 40%-60% long term, with 70% paid at half year due to confidence in future performance.

• Ongoing investment in technology, marketing, and AI to drive market share expansion, especially in Legal and Administration Services.

• Focus on increasing market share in Licensee Services (from 3%) and Legal and Administration Services (from 10% towards 15%).

• Expectation for further efficiencies and long-term EPS growth from business growth and capital management.