- Release Date: 13/06/14 11:29
- Summary: FLLYR: GFL: GFNZ Group Limited - Full Year Results - Mar 14
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GFL 13/06/2014 11:29 FLLYR REL: 1129 HRS GFNZ Group Limited FLLYR: GFL: GFNZ Group Limited - Full Year Results - Mar 14 GFNZ Group Limited - Full Results GFNZ Group LIMITED RESULTS FOR ANNOUNCEMENT TO THE MARKET Reporting period: 12 months to 31 March 2014. Previous reporting period: 12 months to 31 March 2013. GFNZ Group has confirmed the Group's results for the reporting period for the 12 months to 31 March 2014. The results, as follows, include the percentage change for the previous reporting period of the 12 months to 31 March 2013. Revenue from ordinary activities: $9,648,000 5% down Profit/(Loss) from ordinary activities after tax attributable to security holders: ($4,201,000) 4716% down Profit/(Loss) attributable to security holders: ($4,201,000) 4716% down Interim/final dividend: nil Amount per security: $0.00 Imputed amount per security: $0.00 Record date: n/a Dividend payment date: n/a Comments: Financial Result (12 months to 31st March 2014) The after tax unaudited* financial result for the year was a loss of $4.2m vs a profit of $91k in 2013. * Audit is currently in progress Business Performance: The group reported a loss of $4.2m (March 13 $0.1m profit). The individual operating segments performed as follows: Geneva Financial Services (New Business): - March 14 pretax profit $0.6m (March 13 $0.9m) In the latter part of last year and the first four months of this year, GFSL's lending programs were constrained as the group's cash resources were retained to complete the funding arrangements that allowed the Group to exit moratorium on 1st August 2013. Consequently, lending from April 13 to July 13 averaged 9.6% behind the previous year. This lower lending adversely impacted both the level of the new business receivables ledger and the profit earned from this business operation and is largely responsible for the shortfall in the profit compared to last year. On the 1st August 2013, contemporaneously with the Group exiting moratorium, GFSL secured a $30.0m securitized funding facility. The purpose of this facility is to provide the debt funding to allow the new business model lending programs to expand and it is pleasing to advise that, while there remain challenges ahead, for the period from 1 August 13 to 31 March 14, lending averaged 31.4% above the previous year. Successfully expanding lending, while maintaining asset quality, is key factor in increasing the profitability of this business. Quest Insurance Group (Insurance): March 14 pretax profit $0.5m (March 13 $0.4m) The profitability of this operation is closely linked to the new business's lending programs. The current year result includes a $0.3m gain arising from the sale of its AMPL share investment to the property segment that eliminates on consolidation. Consequently, on a comparative basis the shortfall against last year is $0.2m. Stellar Collections (Old business): March 14 pretax loss $5.5m loss (March 13 $1.2m loss) As signaled in the profit downgrade announced on the 4th April this year, forecast future cash collections from these old ledgers have been revised downwards to reflect both changes in the collections environment and the nature of the residual receivables as these assets age. This has resulted in Stellar taking up additional provisioning against these ledgers and is the prime factor in the loss reported by this business operation. Since year end, we have further restructured this business to lower operating costs and following the successful $6.0m rights issue in May 14, approximately $4.0m of the funds raised have been utilised to re-capitalise this business. These actions are intended to put this operation into a position where it can deliver sustainable profits going forward. Pacific Rise (Property) March 14 pretax profit $0.3m (March 13 $0.1m) The property segment produced a profit of $0.3m on the sale and lease back of our head office. Parent Company March 14 pretax profit $0.2m (March 13 $0.1m loss) The March 14, parent company result includes a one of gain of $1.2m arising from favourable debt collection settlement terms negotiated with the companies bankers when GFNZ Group Ltd exited moratorium. This gain is reduced by the corporate costs associated with governance and corporate services, now carried by the parent company following the implementation of the group restructure (as approved by the shareholders) from 1st August 2013. Balance Sheet: The group's equity to assets ratio decreased to 21.2%, a direct result of the additional provisioning on the old ledgers. The Group rights issue settled in May 2014 and with the additional capital of $6m the equity ratio is estimated to increase to approximately 35%. Operating Costs: Group's total operating costs are 1% lower than last year but included non recurring costs associated with the group exiting moratorium on 1st August 2013. Interest Bearing Repayment Plan: During the period the group repaid in full all funds owed under the Interest Bearing Repayment Plan and as a consequence, the group exited moratorium. This brings the total repayments made to investors since the group entered moratorium in November 2007 to $169m, including $42m of interest. Rights Issue: During May 2014 the rights issue approved by Shareholders on 29 April 2014 settled in full. Under the rights issue the company issued a further 202.2 million shares with Federal Pacific Group taking up 182.8m of these shares and increasing their stake in the company to 57.4%. Funding: As noted above, on 1st August 2013 the group refinanced its operations, repaying all public and bank debt and exited moratorium. As a consequence, the group is no longer a Non Bank deposit taker. There are three components to the Group's new funding as at year end: a. Geneva (the new business model) has secured a $30m securitization facility which was drawn to $18.5m at year end and at the date of this report is drawn to $20m. b. A $5.0m loan from Federal Pacific Group Ltd, which since 31 March 14 has been converted to equity in partial settlement of the rights Issue. c. A three year $5.0m debt funding package from professional investors. As this funding package included loans from GFNZ Group Ltd directors, the terms of these loans were approved by shareholders at a meeting of shareholders on 31st July 2013. Strategic Direction: The Group is committed to the consumer finance and insurance market with the primary focus being on the automotive sector. Obtaining ongoing sustainable distribution channels for our products is now key to capitalising on this opportunity. Summary and outlook: For the five years and nine months "Geneva" has been in Moratorium, the board's primary focus has been to repay our investors while continuing the retain the key "intellectual property" in terms of lending, insurance and debt collection processes and skills. On the 1st August 2013, "Geneva" exited moratorium with the final repayment to debenture holders, 17 months ahead of schedule. In Nov 07, when this task was undertaken no one foresaw the Global Financial Crisis which rocked both the world and New Zealand economies and to have achieved this goal by repaying $169m, including $42m of interest to investors is satisfying. In terms of the future, the primary focus is to enhance shareholder value by putting each business sector in a position to deliver sustainable profits. Specifically: o Expanding GFSL's new business lending. o Increase the distribution of Quest's insurance products. o Successfully collect the balance of Stellar's old ledgers and look to take advantage of opportunities, as they arise and to use these debt collection skills to create future profits. To our investors we say thank you for trusting us to manage the moratorium to your benefit. To our shareholders we reaffirm our commitment to take advantage of the opportunities in front of us to now focus on creating shareholder value. End CA:00251568 For:GFL Type:FLLYR Time:2014-06-13 11:29:31
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- Ann: FLLYR: GFL: GFNZ Group Limited - Full Year Results - Mar 14
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