Australian Finance Group Ltd (AFG) reported a 39% year-over-year increase in net profit after tax to AUD 49 million for the full year ended June 2026, up from AUD 35.3 million in the prior year. Group EBITDA rose 32% to AUD 74 million, while underlying earnings per share climbed 33% to AUD 0.20.
The diversified financial services provider attributed the growth to expansion across its core segments. The securities loan book reached a record AUD 7.1 billion, a 30% increase from the prior year, with settlements rising 47% to AUD 4 billion. The manufacturing segment delivered a 107% jump in EBITDA to AUD 33 million, supported by a 52% rise in gross profit and a 12% increase in operating expenses. The distribution segment contributed AUD 71 million to total EBITDA, with residential settlements up 18% to AUD 75 billion and subscription income rising 13% to AUD 24 million.
Underlying return on equity improved to 23% from 19%, with the distribution segment achieving a 40% ROE and manufacturing at 30%. The cost-to-income ratio tightened to 55% from 59%, while the cash conversion rate stood at 94%. Unrestricted cash totaled AUD 63 million, and the trail book net asset value reached AUD 84 million.
AFG’s net interest margin in securities increased by 9 basis points to 125 basis points, exceeding its long-term target of 120 basis points. The exit margin was 128 basis points. The company allocated AUD 21 million to capital deployment across securities, technology and broker investments, and returned AUD 30 million to shareholders via dividends and buybacks. The dividend yield stands at 4.9%, with 11 consecutive years of payouts.
Management highlighted AFG’s reduced exposure to short-term residential lending, with only about 10% of earnings directly tied to lending volumes. Approximately 78% of earnings now derive from diversified sources, including trail commissions, recurring subscription income and existing loan books. The broker network connects more than 4,300 brokers and 600,000 customers to over 80 lenders, with broker-mediated lending accounting for 81% of Australia’s residential mortgage market—up from 50% in FY 2016.
Looking ahead, AFG expects FY 2027 annualized EBITDA to rise by AUD 13 million, driven by AUD 10 million from the securities loan book, AUD 2 million from technology investments and AUD 1 million from broker investments. Shares rose 1.3% to AUD 1.56 following the results, near the midpoint of the 52-week range between AUD 1.465 and AUD 2.92.
