Harmoney has reaffirmed its A$16 million-plus FY27 Cash NPAT target after growing its loan book 9% to A$912 million. The new Australian intermediary channel generated A$7 million in loans within two months, while credit quality and margins remained stable.
- A$16m+ FY27 Cash NPAT guidance reaffirmed, implying at least 18% growth
- Australian intermediary channel originates A$7m in under two months
- Group loan book rises 9% to A$912m, led by Australia
- 90+ day arrears improve to 0.64% while credit losses hold at 3.8%
- Cost-to-income ratio improves to 18% as Stellare automation scales
Intermediary channel delivers early traction
Harmoney Corp Limited (ASX:HMY) has found an early growth engine outside its traditional direct-to-consumer model, with its new Australian intermediary channel originating A$7 million in less than two months. The lender launched the channel in August, added a second Australian partner in September and now has four partners operating across Australia and New Zealand.
The initial volumes remain small relative to Harmoney's overall book, but the company says more intermediaries are expected to join through the second quarter of FY27. Its investor presentation puts the potential annual funded volume from more than 10 intermediaries at over A$100 million by FY28, against an Australian car-lending market it estimates at about A$20 billion a year. Those figures are targets and market estimates, rather than delivered revenue.
Loan book reaches A$912 million
Group originations rose 4% from the prior corresponding quarter to A$122 million, with September recording Harmoney's highest-ever monthly originations in local currency. The loan book expanded 9% to A$912 million, including 14% growth in Australia to A$573 million. New Zealand lending increased 11% to NZ$418 million in local currency.
The quarter also extends the trajectory described in Harmoney's April profit guidance update, which highlighted loan growth, automation and secured lending as contributors to the business's expansion. In the latest update, the vehicle loan book was reported as 22% higher than a year earlier, while the company said the intermediary channel uses the same Stellare platform, credit models and automated processes as its direct business.
Credit metrics hold as operating leverage improves
Harmoney reaffirmed FY27 Cash NPAT guidance of A$16 million or more, compared with A$13.5 million in FY26. That represents growth of at least 18%, although the quarterly figures are unaudited and the guidance remains subject to the risks and assumptions set out by the company.
Underlying operating measures were broadly steady or better. Net interest margin held at 10.3%, credit losses remained at 3.8% and the risk-adjusted income margin stayed at 6.5%. More than 90-day arrears improved from 0.77% to 0.64%, while the cost-to-income ratio fell from 19% to 18%, suggesting the automated platform is absorbing additional lending volume without a matching increase in operating costs.
Funding capacity and buy-back remain in focus
Harmoney said it has more than A$1 billion of warehouse credit capacity in local currency to support growth across its direct and intermediary channels. The presentation also said 97% of the loan book was funded through non-recourse warehouse facilities, with funding provided by three of Australia's Big Four banks. As at 30 June, the company reported A$27 million of unrestricted cash, A$28 million of warehouse equity and A$12 million of accessible cash, as defined in the presentation.
The on-market buy-back is continuing, with 1,861,229 shares repurchased since it began in May 2025. The programme is scheduled to end no later than 29 April 2027, but remains dependent on share price, trading volumes and market conditions. That makes the capital return a secondary feature of the update; the more consequential test is whether intermediary volumes can scale while the 3.8% credit-loss rate and 6.5% risk-adjusted margin remain intact.
Bottom Line?
Harmoney has started FY27 with stronger distribution and improving efficiency, but the guidance case now rests partly on converting early intermediary traction into repeatable volume without weakening credit or margins.
Questions in the middle?
- How quickly will the additional intermediary partners contribute meaningful originations beyond the initial A$7 million?
- Can Harmoney maintain its 3.8% credit-loss rate as the Australian vehicle loan book and intermediary mix expand?
- Will loan-book growth and warehouse capacity translate into Cash NPAT above the A$16 million guidance floor?