Humm Group Limited

Thank you for standing by and welcome to the Hum Group Limited FY26 results. There will be a presentation followed by a question and answer session via webcast. To ask a question, attendees can select the raised hand icon located in the top right hand corner of the webcast screen. Questions can then be submitted through the webcast platform only. I would now like to hand the conference over to Angelo Demasi, Chief Executive Officer. Please go ahead.

Thank you, and good morning.

Thank you, everybody, for joining us today as we release Hung Group's full year results for the FY26 year. I'm Angelo Demasi, Group Chief Executive Officer and Managing Director, and joining me today is Tony Taylor, Hung Group's Interim Chief Financial Officer. I'll start by drawing your attention to the disclaimer on slide two. As always, this presentation contains forward-looking statements that are subject to risks and uncertainties. This includes underlying and other non-inference measures which are unaudited. It should be read alongside our other periodic and continuous disclosures lodged with the ASX. All figures are in Australian dollars and as otherwise stated. Turning to slide three, you will see the agenda for today's presentation. Today, Tony and I will walk you through the slides included in the investor presentation. I'll start with the highlights of the group's performance and the year in review. Tony will then take you through the financials in more detail. I'll then close with a summary and outlook for FY27. We'll open for questions at the end. With that, let's move to slide five, where we have summarised the year in review. Against the backdrop of macroeconomic and geopolitical uncertainty, Hum Group has successfully navigated an extraordinary level of corporate activity. This included two successive non-binding indicative offers and the associated due diligence processes, an activist shareholder campaign culminating in board renewal, extensive takeover panel proceedings and voluntary undertaking, multiple ASIC investigations into historical matters, and the determination and settlement of the Forum Finance Federal Court proceedings. At the same time, the external environment presented its own challenges. The conflict in the Middle East and disruption to fuel supply weighing on our commercial demand, the volatile New Zealand dollar impacting reported earnings from November onwards, a softening in consumer and SME demand, and the commencement of a new buy-now-pay-later regulatory regime in June 2025. Importantly, many of these matters are now largely behind us. I want to acknowledge the resilience of our people, the trust of our customers, merchants and brokers, and the strength of our operating model, which allowed us to keep moving forward, execute with discipline and deliver results despite sustained external and corporate pressures. Let's now move to slide six, highlighting the Group's performance and key results. The headline is an underlying net profit after tax adjusted for non-cash items and excluding irregular items was $44.2 million. Those irregular items totaled $19.1 million before tax and largely related to the corporate and legacy matters we have just stepped through. On that basis, underlying diluted earnings per share were $0.08 and underlying return on equity was 8.5%. Importantly, the underlying cost-to-income ratio was 51.9%. That is the clearest indication that, beneath the noise of the year, the underlying cost base remained disciplined. Credit also remained well controlled, with Group Net credit loss to average net receivables at 2%, demonstrating disciplined credit management through the cycle. Statutory profit after tax was $15.7 million, absorbing the irregular items, the full impact of the year's credit provisioning, and other non-cash items. Importantly for shareholders, the board has declared a fully-spring dividend of two cents per share for FY26, a 4.5% return. Taken together, these measures show a business that delivered resilient underlying earnings, maintained disciplined costs and credit performance, and continued to return capital to shareholders through an unusually complex year. Let's now turn to slide seven, further detailing key performance metrics. There are three key points I'd like to draw out. First, profitability was clearly impacted by irregular items, but the underlying earnings picture remained resilient. We have presented both statutory profit and also underlying net profit after tax adjusted for non-cash items and excluding the irregular items clearly and transparently throughout the presentation. Second, the underlying cost base remained disciplined. While the reported cost to income ratio was 57.7%, reflecting the irregular items we have already discussed, on an underlying basis, excluding those irregular items, operating expenses were $169.7 million and the underlying cost to income ratio was 51.9%. Third, net interest margin improved. While net interest income of $258.3 million was down 2.3%, net interest margin improved 10 basis points to 5.5%, supported by lower funding costs, disciplined pricing and a favourable consumer portfolio mix.