Mortgage Choice posts 12% rise in net profit on record home loan settlements

Mortgage Choice Limited reported a profit growth of 12.4 percent for the six months ending December 31, boosted by a record $6 billion in mortgage settlements during the period.

The mortgage broker’s shares ended up 7.3 percent on the ASX on Wednesday.

The company said its loan book also crossed the $50 billion milestone and hit $50.7 billion, up 4.7% from 1H15.

“We have recorded our strongest ever interim profit result, which is a testament to the Mortgage Choice business as a whole, as well as the strength of our plans and our ability to execute those plans,” Mortgage Choice chief executive officer John Flavell said in a media release.

The mortgage broker’s net profit after tax on a cash basis was $10.1 million, up 12.4% from in 1H15. Group revenue grew to $102.3 million, up 5.4% on 1H15.

It settled home loans worth $6.2 billion in 1H16, an 8.5% increase from 1H15 and its highest ever.

The company also announced a fully franked interim dividend of 8 cents per share, up from 7.5 cents in 1H15.

“Our strong profit growth of 12.4% has come from significantly growing our revenue and controlling our operating expenses whilst continuing to invest for future growth. Since addressing Help Me Choose, we have been able to dedicate more resources to those parts of the business that align with our 2020 strategy,” Flavell said.

“We have seen a significant increase in both the number of referrals going to our financial advisers as well as the number of brokers referring business.”