A leading provider of pre-owned automotive finance Money3 Corporation Limited (ASX: MNY) recently held its Annual General Meeting (AGM) on 27 November 2018 wherein the management highlighted about the financial performance and market outlook.
As per the release, Money3 Corporation has settled more than 800k loans worth over $1 Bn in value over the last eighteen years. The company reported over 15,000 new secured auto loans in FY 2018 despite no additional funding until late-May 2018. The secured auto loans increased by 16.6 percent in FY 2018. The company is currently providing Car loans up to $35,000 over periods of up to 60 months.
During the financial year 2018, the gross loans receivable of the company increased by 12.8 percent to $308.1 million as compared to the previous corresponding year. The broker lending revenue of the company increased by 31.4% to $73.6 million. The group revenue increased by 11.2% to $121.9 million. Further, the group EBITDA of the company increased by 11.9% to $56.6 million and the group NPAT increased by 10.1% to $32.0 million. The earning per share of the company increased by 5.8% to 19.91 cents per share in FY 2018.
As per the company’s report, 1 out of 600 vehicles in Australia is financed by Money3 Corporation and they are currently dealing with the 2% of their target market. As of now, the Australian automotive market is having an annual vehicle sale of over $80 billion and over 1.2 million new vehicles are sold annually in Australia. Further, the deployment fund of around ~$84 Mn is providing significant headroom for the company’s loan book growth.
In the first quarter of FY 2019, the company reported $34.0 million worth of receipts from customers which is 10.4% higher than the previous corresponding period. The net cash used from operating activities increased from $0.4 million in the first quarter of FY 2018 to $5.9 million in the first quarter of FY 2019. In FY 2019, the company anticipates funding ~$170 Mn of car purchases, out of $6 Bn in used vehicle financing opportunity.
To control the cost, the company has extended its expenditure review program to FY 2019 with the focus on automation technology and an ongoing review of consolidation across the branch network. The company is planning to increase its market share in the secured loans sector through high-tech, low-touch broker integrations as well as enhancing its own direct sales channels to new, existing and paid-up customers. The group is actively pursuing M&A opportunities with a view to expanding into complementary product sets and strengthening particular geographic areas. As at 31 October 2018, the company was having cash of $34 million and debt of $98.1 million.
In the last six months, the share price of the company decreased by 11.26 percent as on 27 November 2018. MNY’s shares traded at $1.637 with a market capitalization of $304.54 million as on 28 November 2018 (AEST 3:22 PM).
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