Credit Corp Group (ASX:CCP) Releases FY25 Market Update
Financial Performance
Credit Corp Group has maintained its FY25 NPAT guidance of $90-100 million, with EPS expected between 132 and 147 cents. The company targets a long-term ROE of 16-18% and maintains a low gearing ratio below 30%.
Operational Highlights
The US debt buying segment is set to contribute almost 20% of FY25 NPAT, supported by diversified purchasing and significant productive capacity. In AU/NZ lending, the company leverages its expertise with automated decisioning and efficient collection practices, disrupting the market with lower APRs and no payday loans. The AU/NZ debt buying segment benefits from a large database and high asset turnover.
Market Overview
Credit Corp has expanded its facilities to $505 million as of July 2024, ensuring substantial cash and headroom for opportunistic investments. The FY25 pipeline is on track with a full-year guidance of A$150 million and an annualised investment run rate of A$200 million. The AU/NZ debt buying market remains subdued, with aggregate credit and charge-off rates stabilising.
Future Outlook
New products like Wizit digital credit card and CarStart auto finance are expected to sustain lending segment growth in the medium term. The pipeline remains at the guidance midpoint of $90 million, with ongoing repayment arrangements totaling $1.3 billion.
Motley Fool contributor Kiarra Jackson has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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