Mortgage Choice reports ‘best ever’ NPAT cash result

Mortgage Choice Limited (MOC) today announced its best ever NPAT cash and dividend results for the financial year ended 30 June 2014.

August 21, 2014

Mortgage Choice Limited (MOC) today announced its best ever NPAT cash and dividend results for the financial year ended 30 June 2014. 

Over the last financial year, the Group managed to capitalise on the industry tailwinds and significantly grow its core business while successfully transitioning into a fully fledged financial services powerhouse. 

Financial highlights for the 12 months to 30 June 2014

  • Net profit after tax (NPAT) on a cash basis was $18.7 million, an increase of 18.6% on FY13.
  • Mortgage Choice's loan book, reached $47.4 billion. This was up 4.6% from $45.3 billion at 30 June 2013. 
  • $12.2 billion worth of housing loan approvals were written by Mortgage Choice in the year, up from $10.4 billion in FY13.
  • Mortgage Choice's settlements hit $10.4 billion, up 18.1% from $8.8 billion in FY13.
  • Shareholders rewarded with a fully franked final dividend of 8 cents per share, which takes the total dividends for the year to 15.5 cents per share – up from 13 cents per share in FY13.

IFRS highlights for the 12 months to 30 June 2014

  • NPAT was $18.5 million, down 1.4% on $18.7 million in FY13 (excluding gain on sale of LoanKit). This result can be attributed to the fact that Mortgage Choice was required to realign its valuation assumptions to reflect the changing economic factors.
  • Earnings per share is now sitting at 16.0 cents, up from 15.2 cents in FY13 (including the sale of LoanKit).
  • Total group revenue was $178.5 million, up 14.8% on FY13.

Mortgage Choice CEO Michael Russell said the company's latest annual financial results far exceeded expectations and any financial goals that had been set.

“We have embraced the opportunities that the strong market has presented us with and managed to deliver some of our best financial results to date. Over the last year, we have managed to significantly grow our underlying statutory revenue and profit, achieve a record number of loan settlements, and realise our highest cash result to date,” he said.

“In addition, we continue to grow and evolve our diversified business and are now well on our way to becoming a very successful diversified financial services player.

“Shareholders will once again be very pleased with the dividend result, which is significantly higher to that received in FY13 – a fully franked dividend of 15.5 cents per share for the year.”

Financial and operational performance

Mortgage Choice is pleased to report an 18.6% jump in year on year cash profit after tax.

The company's loan book grew by 4.6% to reach $47.4 billion. In addition, home loan approvals grew by an incredible 17.3% to $12.2 billion, while settlements rose by 18.1% to $10.4 billion.

This impressive growth speaks volumes for the strength of the Mortgage Choice business model. The core mortgage broking business in particular has managed to achieve an excellent result, posting its best cash result and highest annual settlements on record. At the same time, the Group's network of mortgage brokers expanded, reaching a current franchise footprint of 405 and 549 loan writers.

The outlook for FY15 is very positive. The property market remains strong, with dwelling values on the rise and auction clearance rates continuing to hover at solid levels. Further, home loan approvals have hit a new high, which is reflected in the Group's strong home loan approval growth. 

Future growth

Mortgage Choice continues to invest for the future in its core business, its diversified businesses, and comparison website, as well as its relatively new Mortgage Choice Financial Planning business.

“The financial planning business is expected to turn a profit on a monthly basis from next financial year and we are well on track to reach our goal of 60 advisers on the ground by 30 June 2015, with 33 already in place,” Michael Russell said.

Mortgage Choice's other diversified business, (HMC), continues to improve, with the business now profitable and growing in line with expectations.

Moving forward, Mr Russell said the business remains as focussed as ever on executing its existing ACT strategy, on building a compelling and differentiated customer experience, and providing sustainable earnings for its shareholders.

“We are in a very exciting stage of the business. At present, we are successfully transitioning the business into a diversified financial services powerhouse and we will continue to focus on our growth and diversification moving forward – adding value to our customers, franchisees, and our shareholders.”

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