Financial Data and Key Metrics Changes - The underlying NPAT was £40.8 million, with statutory NPAT up 21% to £35 million [25] - Gross profit increased by 12% or £15 million, reflecting growth across both distribution and manufacturing [25][30] - Operating expenses totaled $96.6 million, with a normalized second half OpEx of $46 million, down from the first half [26][28] Business Line Data and Key Metrics Changes - Distribution earnings contributed 81% of the business, with gross profit up 10% to $68 million [6][30] - Manufacturing earnings surged 53% to $16 million, driven by scalable processes and prudent risk management [4][30] - Subscription income rose 13% to $21 million, driven by increased adoption of BrokerEngine plus and other value-added services [4] Market Data and Key Metrics Changes - Broker market share increased from 75% to 77%, with expectations to reach 80% [11] - AFG Securities loan book grew 23% to $5.5 billion, with settlements up 65% [3][19] - The residential mortgage book grew by 5% to $211 billion, indicating strong market activity [6][16] Company Strategy and Development Direction - The company focuses on three strategic pillars: growing the broker network, providing market-leading technology, and delivering high margins through the distribution network [8][9] - Investments in technology and strategic acquisitions are aimed at expanding the product suite and enhancing broker relationships [4][8] - The company anticipates continued consolidation within the broker industry, positioning itself to capture future growth opportunities [12][60] Management's Comments on Operating Environment and Future Outlook - The management expressed optimism about the economic environment, citing lower unemployment and cash rate reductions stimulating market activity [3][42] - The company is cautiously optimistic about future growth, supported by favorable macroeconomic conditions and a strong broker network [52] - Management highlighted the importance of brokers in providing competition and choice in the marketplace, with expectations for continued growth in broker share [44][45] Other Important Information - The company maintains a strong capital position with $182 million in investments and liquid assets [4] - The dividend payout ratio for FY '26 and beyond is expected to be between 50-70% of adjusted NPAT, allowing for reinvestment or returning excess cash to shareholders [29] Q&A Session Summary Question: Changes in the approach of major banks towards brokers - Management noted that major banks remain engaged with the broker channel despite their focus on proprietary networks, emphasizing the importance of choice and competition for customers [56][58] Question: Growth potential of the broker industry and AFG's market share - Management believes consolidation will occur in the broker industry, with potential for AFG's market share to increase as they provide additional services to brokers [60][61] Question: Revenue uplift from brokers writing multiple products - Management indicated that while achieving 100% of brokers writing multiple products is unlikely, there is significant potential for growth in this area, enhancing customer experience and revenue [64][65] Question: Impact of white label and securitization on home loan volume - Management clarified that the cessation of the white label program affected July's volume, but new products are expected to drive growth moving forward [70][73] Question: Management of margin versus volume trade-off - Management confirmed a focus on volume growth while being mindful of return on capital, indicating a balanced approach to managing margins [97] Question: Outlook for payout ratio and margin - Management acknowledged a natural ceiling for payout ratios, indicating that the current levels are a function of mix and volume rather than a slowdown in payouts [95][96]

Financial Data and Key Metrics Changes - The underlying NPAT for FY '25 was £40.8 million, with statutory NPAT up 21% to £35 million [26] - Gross profit increased by 12% or £15 million, reflecting growth across both distribution and manufacturing segments [26][32] - Operating expenses totaled $96.6 million, with a normalized second half OpEx of $46 million, down from the first half [27][30] Business Line Data and Key Metrics Changes - Distribution earnings contributed 81% of the business, with gross profit up 10% to $68 million [6][32] - Manufacturing earnings surged 53% to $16 million, driven by a larger loan book and improved net interest margins [4][32] - Subscription income rose 13% to $21 million, supported by increased adoption of BrokerEngine plus and other services [4] Market Data and Key Metrics Changes - Broker market share increased from 75% to 77%, with expectations to reach 80% [12] - AFG Securities loan book grew by 23% to $5.5 billion, with settlements up 65% [3][20] - The residential mortgage book grew by 5% to $211 billion, indicating strong market activity [6][17] Company Strategy and Development Direction - The company focuses on three strategic pillars: growing the broker network, providing market-leading technology, and delivering high margins through the distribution network [8][10] - Investments in technology and strategic acquisitions are aimed at diversifying income sources beyond traditional residential mortgage aggregation [4][10] - The company anticipates continued consolidation within the broker industry, positioning itself to capture future growth opportunities [13][52] Management's Comments on Operating Environment and Future Outlook - The management expressed optimism about the economic environment, citing lower unemployment and cash rate reductions stimulating market activity [3][44] - The company expects strong momentum into FY '26, supported by a record pipeline and improving market conditions [16][44] - Management highlighted the importance of brokers in the marketplace, emphasizing their role in providing competition and choice to consumers [46] Other Important Information - The company maintains a strong capital position with $182 million in investments and liquid assets, allowing for reinvestment where returns are compelling [4][40] - Cash conversion for the year was 90%, with a net cash position of $12 million, providing capacity for growth [40] Q&A Session Summary Question: Changes in the industry approach to brokers - Management noted that major lenders remain engaged with brokers despite their focus on proprietary networks, as brokers provide essential customer choice and competition [58][60] Question: Growth potential of the broker industry - Management believes consolidation will occur, but currently, it is a favorable time for brokers, with opportunities for growth and customer retention through additional services [62][63] Question: Revenue uplift from brokers writing multiple products - Management indicated that while achieving 100% of brokers writing multiple products is unlikely, there is potential for growth beyond the current 58% [65][67] Question: Home loan volume and securitization - Management clarified that the decline in home loan volume was due to the cessation of a white label program, with new products expected to drive future growth [74][76] Question: Net interest margin (NIM) benefits from rate cuts - Management discussed the impact of lower cash rates on NIM, indicating a small improvement alongside ongoing competitive pressures [80][82] Question: Outlook on payout ratios - Management acknowledged a natural ceiling on payout ratios, influenced by the mix of broker activity and overall market conditions [96][97] Question: Margin versus volume trade-off - Management confirmed a focus on volume growth while being mindful of return on capital, indicating a balanced approach to managing margins [98][99]