MME (ASX) Ann: MONEYME Expands Funding Capacity

Originally posted by Brett M H: ↑

G'day everyone!!

IMO we are seeing some "significant yet small signs" that MME will not only survive but prosper going forward.

Increased cash & continued profitability & stronger NIM's & higher originations are clearly all good signs.

Below is some further press that I just read about this new funding capacity for Autpay:

MoneyMe doubles Autopay warehouse facility to $750m
MoneyMe doubles size of Autopay warehouse facility to $750 million
Fintech says the funding increase an important growth enabler for Autopay
MoneyMe looks to increase loan originations with car finance a focus
Special Report:MoneyMe has secured a deal with its debt funders to extend and double its Autopay warehouse facility from $375 million to $750 million, as the fintech works to gain a greater slice of Australia’s automotive financing sector.
Non-bank lender MoneyMe’s (ASX:MME) warehouse funding facility with Autopay was first issued in 2021.
The updated agreement includes financing efficiencies with MME saying it releases just over $10 million of unrestricted cash into the business to help with growth plans.
Under the new terms, MME says loan book growth in the Autopay warehouse is significantly more capital efficient.
MME managing director and CEO Clayton Howes says the expanded facility enables increased originations growth, which is expected to result in greater economies of scale and profitability going forward.
“This is a significant step in optimising MoneyMe’s funding program that allows improved efficiency of capital allocation and risk adjusted returns,” he says.
“The car loan market is a strategic focus for MoneyMe and this funding increase is an important growth enabler for our Autopay product.
“The release of unrestricted cash will further support the growth of our business.”

Key player in Australia’s growing automotive finance sector
Launched in 2021, Autopay is MME’s secured car loan product, offering loan approval and settlement in as little as 60 minutes.
MME provides access to Autopay through its partnered vehicle dealers and brokers and recently extended the product to caravans.
With expanded funding capacity for Autopay, MME is positioned to take a bigger slice of Australia’s automotive finance industry, which has been undergoing structural shifts in recent years as big banks move away from the space.
The Australian automotive financing market was valued at US$50.60 billion in 2021 and forecast to be worth more than US$73 billion by 2027 end, registering a CAGR growth of 6.3% during the forecast period.

MoneyMe maintains profitability despite challenging economic conditions
Despite challenges posed by a rising interest rate environment, persistent inflation and increasing cost-of-living pressures affecting Australian consumers, MME maintained profitability in H1 FY24.
MME reported statutory NPAT of $6 million for the first half, which it attributed to strong credit performance, efficient interest rate management, and tech-driven cost savings.
Loan originations rose to $277 million, marking a 23% increase from H2 FY23, contributing to the company’s ongoing transition towards higher-quality credit assets.
The total loan book balance reached $1.2 billion during H1 FY24. MME says it expects to further increase originations growth when macro conditions improve, with the car finance market a strategic focus

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I also think the recent director appointment of Jamie McPhee provides an encouraging endorsement of the company's position and future. Ex-CEO of ME Bank, ex-chairman of Society1 (acquired by MME) so knows his way around the sector and would know the business reasonably well from prior DD on the S1 sale and disclosures from the director process. Hard to see him jumping into something with significant challenges ahead, which is where MME is priced.

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I also think the recent director appointment of Jamie McPhee...

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