Cadence Capital Reports 71% Profit Drop, Declares 3.0c Final Dividend
Cadence Capital Limited reported a sharp decline in profit for FY2025, down 71% from the prior year, while declaring a steady 3.0 cent final dividend and continuing its share buy-back program.
- Revenue down 58% to $15.3 million
- Profit after tax falls 71% to $6.3 million
- Final dividend declared at 3.0 cents per share, partially franked at 50%
- Net tangible assets per share slightly decreased to $0.98
- Positive operating cash flow of $37.2 million reverses prior year’s negative cash flow
Financial Performance Overview
Cadence Capital Limited has released its preliminary final report for the year ended 30 June 2025, revealing a significant downturn in financial performance compared to the previous year. Revenue from ordinary activities dropped by 58% to $15.3 million, while profit after tax attributable to members plunged 71% to $6.3 million. This stark decline reflects a challenging investment environment and lower realised and unrealised gains on investments.
Despite the weaker earnings, the company maintained its dividend policy, declaring a final dividend of 3.0 cents per share, partially franked at 50%, payable on 31 October 2025. This matches the interim dividend paid earlier in the year and the dividends paid in FY2024, signaling management’s commitment to returning capital to shareholders even amid profit pressures.
Balance Sheet and Capital Management
Cadence’s net tangible asset backing per share saw a modest decline from $1.02 to $0.98, reflecting the overall reduction in net assets to $292.3 million from $304.1 million. The company’s balance sheet remains robust, with financial assets valued at $212.5 million and cash and cash equivalents increasing to $83.1 million, offset by bank overdrafts of $49 million.
The company continued its on-market share buy-back program, approved to repurchase up to 10 million shares, which has been active since October 2023 and is scheduled to conclude in October 2025. This ongoing buy-back activity, alongside the dividend reinvestment plan, indicates a strategic focus on capital management and shareholder value enhancement despite the earnings contraction.
Cash Flow and Operational Insights
Notably, Cadence reversed a prior year negative cash flow from operating activities of nearly $100 million to a positive $37.2 million in FY2025. This improvement was driven by proceeds from the sale of investments exceeding purchases, alongside steady dividend and interest income. Management fees and finance costs remained substantial but were well covered by operating cash inflows.
The company reported no material contingent liabilities or capital commitments, maintaining a clean slate for future operational flexibility. The financial report is preliminary and subject to audit, which may lead to minor adjustments before finalisation.
Looking Ahead
While the profit decline is notable, Cadence’s steady dividend and active capital management suggest confidence in its portfolio’s longer-term prospects. Investors will be watching closely for the audited results and any strategic updates that might signal how the company plans to navigate ongoing market volatility and restore growth momentum.
Bottom Line?
Cadence Capital’s earnings dip challenges investors, but steady dividends and buy-backs hint at resilience ahead.
Questions in the middle?
- What factors primarily drove the 71% profit decline despite positive cash flow?
- How will ongoing market conditions affect Cadence’s investment strategy and dividend sustainability?
- What impact will the share buy-back program have on the company’s capital structure and shareholder returns?
