COG Financial Services reported solid half-year results with an 8% rise in underlying revenue and a 14% increase in profit after tax, driven by acquisitions and expanded equity stakes. The company also announced a fully franked interim dividend of 3.5 cents per share.
- 8% increase in underlying revenue to $196.9 million
- 14% rise in underlying profit after tax attributable to members to $10.4 million
- Earnings per share up to 4.80 cents
- 10 million new shares issued to fund increased stake in Fleet Network
- Declared fully franked interim dividend of 3.5 cents per share
Robust Financial Performance Amid Strategic Expansion
COG Financial Services Limited has delivered a strong half-year performance for the six months ended 31 December 2025, reporting an 8% increase in underlying revenue to $196.9 million and a 14% uplift in underlying profit after tax attributable to members, reaching $10.4 million. Earnings per share rose to 4.80 cents, reflecting the company’s ongoing focus on growth and operational efficiency.
The company’s results were underpinned by solid contributions across its core segments: broking and aggregation, salary packaging, and lending. Notably, the salary packaging segment experienced a 41% revenue increase, boosted by the acquisition of Easifleet and favourable tax incentives for electric vehicles, which accelerated volume growth.
Strategic Acquisitions and Capital Management
During the period, COG strategically expanded its footprint through acquisitions and increased equity stakes in key subsidiaries. The acquisition of Easifleet in September 2025 added $5.3 million in revenue and $1.3 million in net profit after tax for the period, with pro forma contributions suggesting even stronger full-period impact.
In October 2025, COG issued 10 million new shares, raising $20 million to fund the purchase of an additional 14.08% equity interest in Fleet Network, increasing its controlling stake to 92.38%. This move consolidates COG’s position in the equipment finance broking sector, where it now accounts for approximately 25% of annual net amount financed settled by finance brokers in Australia.
Dividend Policy and Shareholder Returns
The Board declared a fully franked interim dividend of 3.5 cents per share, up from 3.0 cents in the prior corresponding period, reflecting confidence in the company’s cash flow and earnings stability. The dividend reinvestment plan (DRP) remains suspended for this interim dividend, signalling a cautious approach to capital allocation amid ongoing investment activities.
COG’s net assets slightly decreased to $201.5 million from $206.5 million at the previous year-end, influenced by share issuance and acquisition-related transactions. The company maintains a strong cash position of $183.4 million, supported by operational cash flows and financing facilities, ensuring ongoing liquidity despite current liabilities exceeding current assets due to short-term notes issued by a subsidiary.
Outlook and Market Position
COG’s diversified business model, spanning broking, salary packaging, and lending, positions it well to capitalise on growth opportunities in the Australian SME sector. The company’s aggregation platform and expanded equity interests enhance its scale and operational synergies, while acquisitions like Easifleet align with strategic objectives to broaden national coverage.
While acquisition accounting remains provisional and contingent payments depend on future tax incentives and volume targets, the company’s underlying performance and capital management demonstrate resilience. The slight increase in expected credit loss provisions warrants monitoring but has not materially impacted profitability.
Bottom Line?
COG’s strategic acquisitions and solid earnings growth set the stage for continued expansion, but investors should watch for updates on contingent payments and credit risk.
Questions in the middle?
- How will contingent payments linked to electric vehicle tax incentives impact future earnings?
- What is the outlook for credit losses given the slight increase in provisions?
- Will COG pursue further acquisitions or equity increases in its subsidiaries to consolidate market share?