Australian Finance Group Ltd (AFG) reported a 21% rise in statutory net profit after tax to $35 million for FY25, driven by record broker numbers and loan book growth. The company declared a fully franked final dividend of 5.3 cents per share, underscoring strong shareholder returns.
- 21% increase in statutory NPAT to $35 million
- Record 4,200 brokers and $101 billion residential lodgements
- AFG Securities loan book grows 23% to $5.5 billion with zero loan losses
- Fully franked final dividend of 5.3 cents per share declared
- Continued investment in technology and broker support programs
Strong Financial Performance Amid Market Resilience
Australian Finance Group Ltd (ASX, AFG) has delivered a robust set of results for the financial year ended 30 June 2025, reporting a 21% increase in statutory net profit after tax (NPAT) to $35 million. Underlying net profit after tax and before amortisation (NPATA) also rose 13% to $40.8 million, reflecting solid operational momentum across its diversified business model.
The company’s performance was underpinned by resilient market conditions in Australia’s mortgage sector, including easing inflation, strong employment, and renewed household income growth. These factors contributed to record residential mortgage lodgements of $101 billion and settlements of $63 billion, with AFG’s broker network expanding to over 4,200 participants.
Growth in Lending and Broker Network
AFG Securities, the company’s lending arm, achieved a 23% increase in its loan book to $5.5 billion, maintaining industry-leading credit quality with no loan losses recorded during the year. This growth was supported by improved net interest margins and the successful launch of a private Residential Mortgage-Backed Securities (RMBS) program, broadening funding sources and enhancing competitive positioning.
AFG’s strategy to broaden its product offering and deepen broker relationships was further evidenced by a 14% increase in commercial settlements and a 33% rise in leasing and asset finance settlements following the full acquisition of the Fintelligence Group. The company also advanced its Broker Investments program, acquiring a 28% stake in Loan Path Finance Pty Ltd post-year-end, signaling ongoing commitment to broker partnership and earnings diversification.
Technology and Sustainability Initiatives
Investment in technology remains a key pillar of AFG’s growth strategy. The rollout of BrokerEngine Plus has enhanced broker efficiency, with user numbers increasing 28% and a Net Promoter Score near 50, indicating strong adoption and satisfaction. The company continues to develop digital tools and compliance services to support brokers in a complex regulatory environment.
On the environmental, social, and governance (ESG) front, AFG reported a voluntary sustainability disclosure for the fifth consecutive year, with a focus on climate risk management, diversity and inclusion, and community engagement. Initiatives include carbon offset programs, tree planting, and partnerships with youth homelessness organizations, reflecting a holistic approach to corporate responsibility.
Dividend and Shareholder Returns
AFG declared a fully franked final dividend of 5.3 cents per share, payable on 8 October 2025, bringing total dividends for FY25 to 9.1 cents per share. This dividend policy aligns with the company’s strong cash flow generation and commitment to delivering shareholder value, evidenced by a three-year total shareholder return of 73%.
The company’s balance sheet remains strong, with unrestricted cash of $63.7 million and liquid assets totaling $182.4 million. Operating cash flow conversion was high at 90%, supporting ongoing investments and capital management.
Governance and Executive Remuneration
AFG’s governance framework continues to emphasize transparency and alignment with shareholder interests. The FY25 remuneration report highlights a performance-linked executive pay structure, with short-term incentives tied to NPATA and loan book growth, and long-term incentives linked to total shareholder return and earnings per share. The CEO and key executives received STI payments exceeding target, reflecting the company’s strong financial results.
Looking ahead, AFG plans to maintain its focus on broker network expansion, technology innovation, and sustainable growth, while navigating dynamic economic conditions. The upcoming Annual General Meeting is scheduled for 17 October 2025, where shareholders will have the opportunity to engage with management on the company’s strategic direction.
Bottom Line?
AFG’s record FY25 results and strategic investments position it well for continued growth, but evolving market and regulatory dynamics warrant close investor attention.
Questions in the middle?
- How will AFG sustain loan book growth amid potential interest rate fluctuations?
- What impact will the Broker Investments program have on long-term earnings diversification?
- How is AFG preparing for mandatory climate-related financial disclosures starting FY26?