Earlypay Ltd Posts 31% Profit Surge, Declares 0.65c Final Dividend
Earlypay Ltd reported a 31% rise in statutory net profit after tax for FY25, driven by growth in equipment finance despite declines in invoice and trade finance. The company declared a fully franked final dividend of 0.65 cents per share and outlined plans to expand its lending portfolios and streamline technology.
- Statutory net profit after tax up 31% to $2.868 million
- Adjusted profit after tax increased 23.7% to $5.117 million
- Invoice finance funds in use declined 10%, trade finance down 72%, equipment finance grew 33%
- Credit loss expense improved to 0.75% of average funds in use
- Fully franked final dividend of 0.65 cents per share declared post-balance date
Financial Performance Highlights
Earlypay Ltd has delivered a solid financial performance for the year ended 30 June 2025, reporting a statutory net profit after tax (NPAT) of $2.868 million, a 31% increase from the restated prior year figure of $2.190 million. When adjusted for significant non-cash and one-off items, the company’s underlying profit after tax rose 23.7% to $5.117 million.
Revenue declined by 6.7% to $50.926 million, reflecting a 10% reduction in invoice finance funds in use (FIU) and a steep 72% drop in trade finance FIU. These decreases were offset by a robust 33% growth in equipment finance FIU, which emerged as the standout segment for the period.
Operational and Portfolio Developments
The company’s strategic pivot towards equipment finance is evident, with originations soaring 183% year-on-year to $80 million. This segment now accounts for $124.2 million in FIU, providing a strong foundation for future income streams and expanding Earlypay’s referrer network. Conversely, invoice finance FIU declined to $118.6 million, impacted by client refinancing to banks and insolvency-related attrition.
Credit quality improved markedly, with credit loss expense halving to 0.75% of average FIU from 1.58% in FY24. This improvement underscores the effectiveness of enhanced risk management and governance frameworks implemented by the company.
Funding and Capital Management
Earlypay successfully repaid its remaining $5 million corporate loan facility in April 2025, transitioning all debt to asset-level borrowings. A new equipment finance warehouse facility is expected to settle by the end of Q1 FY26, anticipated to boost capital efficiency and reduce funding costs. The company now holds approximately $10 million in surplus capital, which it may deploy through share buy-backs, organic growth initiatives, or bolt-on acquisitions.
Reflecting confidence in its financial position, Earlypay declared a fully franked final dividend of 0.65 cents per share, a significant increase from the prior year’s 0.15 cents. This dividend represents the entirety of current retained earnings, signaling a commitment to shareholder returns.
Technology and Growth Outlook
Earlypay is undertaking a key technology consolidation project to unify its three legacy invoice finance loan management systems into a single modern platform. This initiative aims to reduce operational complexity, lower future operating costs, and enhance innovation capabilities, particularly in servicing both traditional and emerging distribution channels.
Looking ahead to FY26, the company’s focus will be on growing its invoice and equipment finance portfolios to drive earnings growth and improve operating leverage. Strategies include pricing adjustments, expanding the sales team, enhancing product offerings, broadening target markets, and intensifying marketing efforts.
Governance and Risk Management
Earlypay continues to strengthen its risk management framework, addressing inherent risks in SME lending such as client defaults, fraud, and funding constraints. The Board and management emphasize maintaining robust underwriting standards, diversified portfolios, and proactive credit monitoring to safeguard financial stability.
The company’s governance practices align with ASX Corporate Governance Principles, ensuring ethical conduct and accountability across its operations.
Bottom Line?
Earlypay’s FY25 results set the stage for growth, but execution on portfolio expansion and technology integration will be critical to sustaining momentum.
Questions in the middle?
- How will Earlypay accelerate new originations and reduce client attrition in its invoice finance portfolio?
- What impact will the technology consolidation have on operational efficiency and client experience?
- How might changes in economic conditions affect credit loss trends and funding costs going forward?
