WT Financial Group has reported a strong 21% increase in underlying net profit before tax for FY2025, driven by robust revenue growth and improved operational efficiency. The company also announced a new joint venture aimed at fueling future expansion.
- Underlying NPBT rises 21% to $5.4 million
- Revenue and other income increase 16.5% to $216.1 million
- EBITDA grows 13.4% to $6.8 million despite higher operating expenses
- Operating cash flow improves to $5.8 million with cash reserves up 22.3%
- New joint venture with Merchant Wealth Partners launched to support financial advice practices
Strong Financial Performance Amidst Growth
WT Financial Group Limited (ASX, WTL) has delivered a solid set of indicative full-year results for FY2025, showcasing a 21% increase in underlying net profit before tax (NPBT) to $5.4 million. This performance reflects a notable 16.5% rise in revenue and other income to $216.1 million, underscoring the company’s ability to expand its core financial advice and wealth management operations.
Despite a rise in direct costs and operating expenses, WT Financial Group managed to grow its gross profit by 17.2% to $21.1 million and improve EBITDA by 13.4% to $6.8 million. The company’s disciplined cost management and operational efficiencies helped offset the increased expenses, resulting in an underlying EBIT increase of nearly 15% to $6.2 million.
Cash Flow and Balance Sheet Highlights
WTL’s operating cash flow rose to $5.8 million, up from $5.4 million the previous year, while cash and cash equivalents increased by 22.3% to $9.8 million. This improvement in liquidity comes after dividend payments totaling $2.1 million and a $1 million final payment related to a prior acquisition, signaling strong cash generation capabilities and prudent capital management.
The company’s interest expenses declined by nearly 15%, further supporting bottom-line growth. Importantly, net one-off income and expenses had a negligible impact, suggesting that the underlying business momentum is sustainable and not reliant on one-time gains.
Strategic Growth Initiatives
Beyond the financial metrics, WT Financial Group announced the establishment of a new joint venture, WTL & MWP Investco Pty Ltd, in partnership with Merchant Wealth Partners Pty Ltd, the Australian arm of the New York-based Merchant Wealth Partners. This 50/50 venture aims to provide strategic growth capital to promising financial advice practices within and beyond WTL’s network.
This move aligns with global trends in financial advice, where patient, long-term capital is increasingly valued over traditional private equity models. The joint venture could position WTL as a key player in expanding its adviser network and enhancing service offerings, potentially driving future revenue and profit growth.
Looking Ahead
WTL plans to release its audited financial statements and Appendix 4E by late August and mid-September, respectively, with no expected material variances from these indicative results. An investor briefing scheduled for 7 August will provide further insights and allow stakeholders to engage directly with CEO Keith Cullen.
Overall, WT Financial Group’s FY2025 results reflect a company capitalizing on its scale and operational strengths while laying the groundwork for strategic expansion through innovative capital partnerships.
Bottom Line?
WTL’s strong FY2025 results and new joint venture set the stage for accelerated growth, but investors will watch closely for execution risks and capital deployment outcomes.
Questions in the middle?
- How will the new joint venture impact WTL’s earnings and adviser network growth in the coming years?
- What are the key drivers behind the rise in operating expenses, and can they be controlled going forward?
- Will the audited results confirm the strong underlying performance indicated in this release?