Shares in Latitude Group Holdings Ltd (ASX: LFS) are trading higher after the company announced a significant jump in full year profit.
In a statement to the ASX on Friday morning the company said net profit was up 208% year-on-year to $94.4 million, and it had boosted its final dividend, from 3 cents per share to 5 cents per share.
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Good growth across the board
The company said it had booked record new credit card spend and loan originations of $9.1 billion, up 10% year-on-year, with total application volumes up 13%, with 307,000 new customers acquired.
Latitude said it had also expanded its retail partner network across core categories, "including home furniture, personal electronics and whitegoods, adding new partners such as E&S Trading and Adairs Retail Group (Focus on Furniture and Mocka), and renewing key partnerships including Harvey Norman''.
Managing director Bob Belan said:
This is a solid result for the company, with FY25 cash NPAT of $105.1 million reflecting the strategic work undertaken over the past two and a half years to simplify and sharpen our focus on what we do best across our core markets. Record volumes of $9.1 billion drove receivables to $7.2 billion, their highest levels in five years. Importantly, net interest margins continued to improve, up 104bps YoY, reflecting targeted pricing initiatives and the benefit of lower funding costs. In the Money Division, new lending of $1.6 billion drove a 10% increase in receivables to a record $3.3 billion, while net interest margin expanded to 11.1% (+109bps YoY), supported by product enhancements, variable rate loan growth outperformance and broker distribution network expansion.
Mr Belan said the company's balance sheet was further strengthened during the year, with $1.5 billion in new term funding locked in, and $1.5 billion in private facilities refinanced at better terms.
He added:
The group's performance demonstrates the ability to achieve strong growth while maintaining margins, disciplined credit outcomes and operating efficiency, supporting sustainable long-term value creation.
Future looking bright
On the outlook the company said it expected to benefit from "strategic initiatives" implemented over the past year to focus on its core consumer segments.
The company said:
Latitude expects credit performance to remain within targeted ranges, underpinned by disciplined underwriting and active portfolio management, while continuing to reflect macro-economic conditions within its core markets. Strong and sustained profit performance and disciplined balance sheet management are expected to create the capacity to prudently return capital to shareholders.
Latitude shares were 6.6% higher in early trade at 93 cents.
The company was valued at $907.2 million at the close of trade on Thursday.
