GFL
30/01/2015 12:02
INTERIM
NOT PRICE SENSITIVE
REL: 1202 HRS GFNZ Group Limited
INTERIM: GFL: GFNZ - Half Year Report - 30 Sep 14
EXECUTIVE SUMMARY
Report from the Managing Director
GFNZ Group announced its results for the six months to 30 September 2014 on 3
December 2014. The unaudited interim result for the period was a profit of
$288k (2012: $88k).
Business Performance:
During the period each of the group's trading entities reported profits
before group overheads. The profit generated by the trading operations
amounted to approximately $900k with the parent cost structure incurring
$620k of costs resulting in a group profit of $288k for the six months.
Geneva Financial Services (Geneva), which is responsible for the "new
business lending" experienced good lending growth during the period and
delivered a $0.5m profit before group overheads.
Quest Insurance Group Limited's (Quest) produced a $0.2m profit before group
overheads.
Stellar Collections (Stellar) which holds the residual old ledgers and old
business assets, produced a profit of $200k before group overheads
Pacific Rise Limited (PRL) which holds an investment in regional medical
property produced a $35k profit before group overheads.
Rights Issue
The Group raised $6.1m of new equity via a rights issue during May 2014. A
total of $0.6m of this was taken up by public shareholders with the remaining
$5.5m taken up by Federal Pacific Group (Fedpac), under their underwrite
agreement with the company. Fedpac settled its share take up by converting
their $5m shareholders loan to equity with the balance being settled in cash.
As a result Fedpac raised its shareholding in the company to 57.42%.
Funding:
The group has two components to its funding:
a. Geneva (the new business model) has a $30m securitisation facility which
is currently drawn to $21.6m.
b. Stellar has a three year $5.0m debt funding package which includes loans
totaling $1.8m from directors.
Standard and Poors Credit Rating:
As a result of exiting moratorium on 1 August 2013 the Company was no longer
required to hold a credit rating and subsequently on 27 June 2014 the Company
ceased its financial strength credit rating with Standard Poors.
Strategic Direction:
The Group is now well placed to expand its lending programs and this is now
the primary focus of the Board. Insurance business premium sales are linked
to the group's lending volumes and improvements in lending are expected to
flow through to the insurance business results. Expansion of the debt
collections operation will also be pursued in the coming year.
Summary and outlook:
The $0.3m reported profit for the first 6 months of the year is a pleasing
result following on from the $4.2m loss reported at March 2013. There remain
challenges ahead, but the Board are confident that the company is now in a
position where profit improvements can be achieved and as a result
shareholder value enhanced.
David O'Connell
Managing Director
End CA:00260174 For:GFL Type:INTERIM Time:2015-01-30 12:02:37
(20min delay)