Announcement
HALFYR: HGH: Heartland announces half year NPAT of $47.5 million
09:11am
HGH
22/02/2022 09:11
HALFYR
PRICE SENSITIVE
REL: 0911 HRS Heartland Group Holdings Limited
HALFYR: HGH: Heartland announces half year NPAT of $47.5 million
NZX/ASX release
22 February 2022
Heartland announces net profit after tax of $47.5 million for the six months
ended 31 December 2021
Heartland Group Holdings Limited (Heartland) (NZX/ASX: HGH) achieved a net
profit after tax (NPAT) of $47.5 million for the six-month period ended 31
December 2021 (1H2022), an increase of $3.4 million (7.8%) compared with the
six-month period ended 31 December 2020 (1H2021). On an underlying basis
(which excludes the impacts of one-offs), 1H2022 NPAT was $47.1 million, an
increase of $3.8 million (8.8%) compared with 1H2021 underlying NPAT.
The first half performance included a pleasing annualised rate of growth in
lending (13.9%). It also demonstrated the benefits of ongoing digitalisation,
with a reduction in the cost-to-income (CTI) ratio.
Impairments were up on 1H2021 (19 basis points (bps)) due to COVID-19 related
extensions that occurred in 1H2021. This was largely successful as reflected
in the 'business as usual' reported rate of 33 bps for 1H2022, which is below
the six months to 30 June 2021 (2H2021) (43 bps contributing to the full year
outcome of 31 bps) and the financial year ended 30 June 2020 (FY2020) (65
bps).
The introduction of changes to the New Zealand Credit Contracts and Consumer
Finance Act 2003 and the Credit Contracts and Consumer Finance Regulations
2004 (CCCFA) slowed growth in Motor and online Home Loans in January and
February 2022. This has the potential to impact on the growth rate for the
remainder of the six-month period ending 30 June 2022 (2H2022). This is being
partially offset by growth in other areas, especially Reverse Mortgages in
Australia and New Zealand, and no material reduction in anticipated full year
growth is expected.
Highlights for 1H2022
- NPAT of $47.5 million, up 7.8% ($3.4 million). Underlying NPAT of $47.1
million, up 8.8% ($3.8 million) on 1H2021 underlying NPAT.
- One-off items had a $0.5 million net impact on NPAT, consisting of $1.1
million of one-off net gains and $0.9 million of one-off expenses.
- Gross finance receivables of $5.4 billion, up 13.9% ($339.4 million).
- Return on equity of 12.2%, up 7 bps.
- Net interest margin of 4.30%, up 3 bps.
- Net operating income of $130.7 million, up 4.3%.
- CTI ratio of 43.8%, down 5.0 percentage points (pps). Underlying cost to
income ratio of 43.1%, down 2.7 pps.
- Impairment expense as a percentage of average receivables increased from
0.19% in 1H2021 to 0.33% in 1H2022.
- 1H2022 interim dividend of 5.5 cents per share (cps), an increase of 1.5
cps from 1H2021.
- Earnings per share of 8.1 cps, up 0.5 cps.
- Progress in digitalisation and continuous integration of product
applications and platforms has provided faster processes and the ability to
offer market-leading rates across New Zealand and Australia.
- Heartland Bank Limited (Heartland Bank) was awarded Canstar Savings Bank of
the Year 2021 (for the fourth consecutive year), and 5-Star Ratings for
Outstanding Value for its Direct Call and YouChoose accounts.
- Australian Reverse Mortgages received two Excellence Awards at the
Australia Mortgage Awards 2021 (Non-Bank of the Year and Most Effective
Digital Strategy - Lender), and won a 5-Star Lender Award in Your Mortgage's
Mortgage of the Year Awards 2021.
- New Zealand Reverse Mortgages awarded Consumer Trusted Accreditation (for
the fifth consecutive year).
See the attachments to this release, including the 1H2022 Results Release for
further information.
- Ends -
For further information, please contact the person(s) who authorised this
announcement:
Jeff Greenslade
Chief Executive Officer
027 382 0023
jeff.greenslade@heartland.co.nz
Level 3, Heartland House, 35 Teed Street, Newmarket, Auckland, New Zealand
Andrew Dixson
Chief Financial Officer
021 263 2666
andrew.dixson@heartland.co.nz
Level 3, Heartland House, 35 Teed Street, Newmarket, Auckland, New Zealand
For media enquiries, please contact:
Shannon Morrison
Communications Manager
shannon.morrison@heartland.co.nz
021 969 310
End CA:00387639 For:HGH Type:HALFYR Time:2022-02-22 09:11:03
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