N1 Holdings Posts $1.25M Net Profit and $11.14M Revenue in HY26
N1 Holdings Limited has reported a strong December quarter with rising revenue, net profit, and cash receipts, underpinned by SME lending growth and funding efficiency improvements. The company also navigates increased regulatory scrutiny with a firm commitment to conservative lending.
- HY26 net profit before tax of $1.25 million and EBITDA of $1.4 million
- Revenue up 4.8% year-on-year to $11.14 million for first half FY26
- Quarterly cash receipts surged 191% to $8.53 million
- SME lending remains core revenue driver, accounting for 98% of cash receipts
- Cash balance strong at $35.48 million with $16 million net operating cash inflow
Solid Financial Performance in a Competitive Market
N1 Holdings Limited (ASX, N1H) has delivered a robust financial update for the December 2025 quarter, showcasing growth across key metrics including revenue, net profit, and cash flow. The company reported a net profit before tax of approximately $1.25 million for the first half of FY26, alongside an EBITDA of $1.4 million, reflecting disciplined execution of its SME lending strategy.
Revenue for the half year rose 4.8% to $11.14 million compared to the previous corresponding period, while cash receipts from customers for the quarter soared by 191% to $8.53 million. This surge was largely driven by the SME lending business, which accounted for 98% of total cash receipts, underscoring the segment’s critical role in the company’s growth trajectory.
Funding Efficiency and Operational Discipline
The company successfully expanded and diversified its funding sources during the quarter, renegotiating terms with existing funders and broadening its network to reduce funding costs. This strategic focus on funding efficiency has enhanced product competitiveness, supporting increased origination volumes.
Operational costs remained stable despite higher lending activity, aided by ongoing AI initiatives that improved processing efficiency and scalability. These technology-driven efficiencies position N1 Holdings well to manage growth without proportional increases in overheads.
Navigating Regulatory Scrutiny with Conservative Lending
In November 2025, ASIC released Report 820, highlighting increased regulatory scrutiny of private credit markets. N1 Holdings welcomed this development, reaffirming its commitment to robust compliance and governance frameworks. The company maintains a conservative lending approach, focusing exclusively on loans secured by established Australian properties and avoiding construction lending risks.
This prudent stance aligns with the company’s risk management philosophy and positions it favorably amid evolving regulatory expectations.
Strong Liquidity and Growth Capacity
As of 31 December 2025, N1 Holdings held a healthy cash balance of $35.48 million and reported a net cash inflow from operating activities of $16.016 million for the quarter. The company’s total lending capacity stands at approximately $351 million, supported by a mix of balance sheet capital, debt facilities, and funds managed through its One Lending Fund subsidiary.
These liquidity metrics provide a solid foundation for continued lending growth and operational resilience in a competitive SME lending landscape.
Looking ahead, N1 Holdings’ strengthened distribution network, including mortgage brokers and referral partners, combined with its funding and operational efficiencies, suggest the company is well positioned to capitalise on market opportunities as funding and interest rate conditions evolve.
Bottom Line?
N1 Holdings’ strong quarter underscores its strategic resilience, but ongoing regulatory scrutiny and market dynamics will test its growth momentum.
Questions in the middle?
- How will ASIC’s increased regulatory focus impact N1 Holdings’ lending practices and growth?
- What are the prospects for further funding cost reductions amid tightening credit markets?
- How effectively can AI initiatives sustain operational efficiency as origination volumes rise?
