GFNZ first-half profit soars 423% on lending growth

Net profit rose to $1.5 million, or 0.31c per share.

GFNZ Group [NZAX: GFL], the finance company formerly known as Geneva Finance, posted a 423%  jump in first-half profit as the lender benefited from an expanded loan book.

Net profit rose to $1.5 million, or 0.31c per share, in the six months ended September 30 from $288,000, or 0.07c, a year earlier, the Auckland-based company said in a statement. Net interest income climbed 71%  to $2.5 million, and the lender's loan book expanded to $48.9 million as at September 30 from $35.7 million a year earlier. Revenue grew 31%  to $5.8 million.

"Overall, the $1.5 million after-tax profit is a satisfying result that represents an improvement on the reported results of the two prior periods," managing director David O'Connell said. "The group is now actively looking to build on the success of the core business and explore expansion opportunities."

GFNZ was one of the few finance companies to survive the sector's collapse last decade, freezing interest payments on its debenture stock in November 2007, when it owed some $132.4 million to investors. Those investors have since been repaid, including $40 million in interest, as the lender slashed staff numbers and closed branches around the country.

The firm, which also operates insurance and debt collection services, specialises in car and personal loans of up to $50,000, and draws most of its funding from a securitisation facility with Westpac Banking Corp.

The NZAX-listed shares rose 5.9% to 5.4c and have climbed 65% this year.

(BusinessDesk)