Harmoney (ASX:HMY) told investors its first-half FY2026 performance surpassed its full-year FY2025 profit, supported by loan book growth, improved margins, and operating leverage from its Stellare 2.0 platform. Management also upgraded full-year cash net profit after tax (NPAT) guidance and outlined product and channel initiatives aimed at accelerating repeat customer borrowing.
Profit exceeds prior full-year result as ROE jumps
For the half year ended 31 December 2025, Harmoney reported statutory NPAT of AUD 6.1 million, up 202%, with non-cash adjustments “netting to zero,” resulting in underlying cash NPAT of AUD 6.1 million, up 166%. Management noted the half-year cash profit exceeded the company’s full-year FY2025 cash NPAT of AUD 5.7 million.
Loan book grows to AUD 857 million; Australia leads while NZ returns to growth
Harmoney said its group loan book rose 9% year-over-year to AUD 857 million, with the company noting headline growth was suppressed by New Zealand dollar weakness versus the Australian dollar. Management added that if the exchange rate had remained at 30 June 2025 levels, the group loan book would have been AUD 882 million. The company said structural hedging meant the currency move did not have a material impact on profitability.
By geography, the Australian loan book increased 17% and represented 61% of the group portfolio. In New Zealand, the loan book grew 5% in local currency, described as a turnaround after contracting during FY2025. Management attributed the improvement to Stellare 2.0, noting New Zealand originations increased 49% compared with the prior year period following the platform’s deployment in June 2025.
Revenue rose 12% to AUD 71.9 million, which management linked to loan book growth and a higher portfolio interest yield.
Margins expand; credit metrics described as stable
Harmoney highlighted net interest margin (NIM) as a “core strength,” reporting total portfolio NIM of 10.3%, up 130 basis points year-over-year. Management said this reflected a higher portfolio interest rate and lower funding costs, pointing to an average portfolio interest rate of 17.2% and a funding rate of 7%.
Risk-adjusted income—defined by the company as income after funding costs and actual credit losses—improved 110 basis points to 6.4%, driven by the higher NIM.
On credit, Harmoney reported actual credit losses of 3.9% and said performance remained stable. The company’s 90+ day arrears improved to 0.58% from 0.64%, which management described as “very low.” Executives added that credit losses ticked up slightly but were expected to flatten or reduce over the remainder of the year.
During Q&A, management said its target loss range is 3% to 4% and described the movement from 3.7% to 3.9% as not meaningful. The company also said returning customers historically have loss rates about 30% to 40% lower than new customers, though it believes the gap has narrowed with improved new-customer assessment under Stellare 2.0.
Automation supports low cost-to-income ratio; customer acquisition efficiency improves
Harmoney said automation continues to drive operating leverage as the loan book scales. The company reported a cost-to-income ratio of 18.5% for the half (management also referenced ~19% in other remarks), compared with 18.9% for full-year FY2025. While the cost-to-income ratio was said to be up slightly versus the prior corresponding half, management described it as market-leading and tied it directly to its Stellare 2.0 platform.
The company also highlighted improved marketing efficiency, reporting an acquisition-to-originations ratio of 3.1%, which it attributed to higher new customer conversion rates and increasing contribution from repeat borrowing. Management said first-loan customer acquisition cost is around 5.6% of the initial loan amount, while subsequent borrowing has near-zero acquisition cost due to direct customer relationships. Harmoney said the average time between a customer’s first and second loan is 15 months, and that customers have historically borrowed an additional 150% after their initial loan.
Funding, liquidity, and guidance upgrade
Harmoney said it refinanced corporate debt in December 2025 with an Australian Big Four bank, calling such a facility “rare in the non-banking finance industry.” It also reported maintaining warehouse facilities with three of the Big Four banks, with total capacity of approximately AUD 1 billion. After a AUD 7.5 million corporate debt repayment, the company said it ended the half with AUD 24 million in unrestricted cash.
On capital efficiency, management said borrowings fund 96% of the current loan book, with Harmoney contributing the remainder. The company cited a required cash contribution of AUD 34 million for the current AUD 857 million loan book, plus an additional AUD 5 million it said is drawable from funders, alongside unrestricted cash. Management said the available cash could support growing the loan book significantly without raising equity and added that each AUD 1 million of profits could fund approximately AUD 25 million of additional loan book growth.
Harmoney upgraded its FY2026 cash NPAT guidance to AUD 13 million, an increase of AUD 1 million or 8% versus prior guidance. Management said the outlook assumes a year-end loan book of over AUD 900 million, a NIM of around 10%, and risk-adjusted income of around 6%.
In Q&A, management said it has no short- to medium-term plans to expand beyond Australia and New Zealand, though it is pursuing product adjacencies and channels. The company also said a pilot mobile app is underway and is scheduled for release in Q4 (April to June), and discussed work on revolving credit and embedded finance partnerships, while noting it had no specific updates to provide on early-stage partnership discussions.
About Harmoney (ASX:HMY)
Harmoney Corp Limited provides secured and unsecured personal loans through online in Australia and New Zealand. The company’s personal loans are used for various purposes, including debt consolidation, home improvement, wedding, car, holiday, education, business, and medical expenses. It also operates Stellare, a platform which deliver seamless and personalised experience. Harmoney Corp Limited was incorporated in 2014 and is headquartered in Auckland, New Zealand.
