Money3 move to car loans yields profits
ASX-listed company personal loans provider Money3 yesterday announced net profit after tax of A$13.7 million to December 2016, up from $10.0 million. This was on the back of a 9.1 per cent growth in revenue to $51.7 million (compared to $47.4 million in December 2015).Based on this performance Money3 upgraded its full year profit guidance to $27.5 million, or twice the current period. The company was also keen to emphasise that it was transforming from a short term unsecured lender to "a scalable diversified financial services company focusing on short and medium term loans, both secured and unsecured."The company's announcement stated that secured automotive loans have grown 52.5 per cent, compared to December 2015, to $190.0 million and now represent 77 per cent of total gross loans receivable, compared to 70 per cent at 31 December 2015. Money3 said it expected to see small amount credit contracts continue to decline as a percentage of the overall gross loans receivable.Chairman Ray Malone was quoted in the company's half-year report saying: "Money3 is actively pursuing further debt funding facilities in order to enable all parts of the business to continue to grow market share." Notes to the financial statements show the company has a $30 million loan facility (fully drawn down at 12 percent) and in play, and $30 million in bonds outstanding.