Humm Group Limited reported a $13.9 million statutory profit for the half-year ended December 2025, despite increased credit losses and elevated costs. The company’s ongoing transformation and global expansion underpin cautious optimism for the year ahead.
- Statutory profit after tax of $13.9 million, down 49.1% year-on-year
- Net credit losses increased to 2.0% due to portfolio seasoning, especially in commercial loans
- Cost to income ratio rose to 57.4%, influenced by litigation and regulatory expenses
- Global operations in Ireland and UK show strong growth and profitability
- Forward Flow arrangements optimise capital efficiency amid disciplined funding
Interim Profit Amid Credit Challenges
Humm Group Limited has released its interim results for the half-year ended 31 December 2025, reporting a statutory profit after tax of $13.9 million. This figure represents a 49.1% decline compared to the prior corresponding period but marks a 13.0% improvement on the previous half-year. The profit was achieved despite rising net credit losses and increased operating expenses, reflecting the company’s resilience amid a challenging economic environment.
Net credit losses rose to 2.0% of average net receivables, primarily driven by the seasoning of the commercial loan portfolio. The commercial segment’s losses peaked in this period but are expected to improve in the second half of 2026. The consumer segment also saw a slight increase in credit losses, though improvements in credit scorecard optimisation in Australia and New Zealand helped offset some of these impacts.
Cost Pressures and Litigation Provisions
The group’s cost to income ratio increased to 57.4%, up from 52.4% a year earlier. This rise was largely due to irregular costs including a $8.3 million provision related to the Forum Finance litigation, as well as regulatory and remediation expenses. Investment in technology and people capability, particularly within the commercial team, also contributed to higher operating expenses. The corporate segment reported a statutory loss of $13.8 million, reflecting elevated legal and regulatory costs and M&A-related expenses.
Stable Margins and Assets Under Management
Despite these headwinds, Humm Group maintained a stable net interest margin of 5.5%, supported by margin improvements on the cost of funds. Net interest income increased by 2.9% compared to the prior corresponding period. Assets under management remained steady at $5.4 billion, with growth in the commercial receivables partially offset by softness in the Australian consumer portfolio and adverse foreign exchange impacts from the New Zealand dollar.
Global Expansion Gains Traction
Humm’s international operations delivered encouraging results, with Ireland and the UK showing strong volume growth and profitability. Ireland’s net interest margin expanded by 330 basis points year-on-year, accompanied by a 26.6% increase in net receivables. The UK business saw volume growth of 55.8% and receivables growth of 69.3% compared to the prior corresponding period. Meanwhile, the Canadian operation underwent a cost base reset, achieving a 33.3% reduction in expenses and positioning itself for future growth.
Capital Management and Forward Flow Strategy
Capital discipline remains a cornerstone of Humm Group’s strategy. The company continues to leverage a diversified funding base, including warehouse funding, mezzanine financing, and private placements. The Forward Flow arrangement, which allows the sale of receivables off-balance sheet, remains a key tool to optimise capital efficiency and support growth without diluting equity. This arrangement contributed to a new revenue stream with a capital-light footprint, enabling the group to fund growth effectively amid market volatility.
Looking ahead, Humm Group is focused on sustaining credit quality, enhancing operational efficiency through technology transformation, and capitalising on global market opportunities. While the first half of 2026 presented challenges, the company’s strategic initiatives and diversified portfolio provide a solid foundation for future growth.
Bottom Line?
Humm Group’s interim results reveal resilience amid credit pressures and elevated costs, setting the stage for cautious optimism in 2026.
Questions in the middle?
- How will the Forum Finance litigation provision evolve and impact future earnings?
- What is the outlook for credit losses in the commercial portfolio beyond 1H26?
- How quickly can technology transformation initiatives translate into sustained cost savings?