Helia shares rally on larger first-half profit and guidance upgrades
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More news: Shares in Helia Group lifted in morning trade after the mortgage insurance provider reported a 38% uptick in first-half profit and upgraded its full-year guidance.
Helia shares were up 3.7% to $5.84 at 11:40am AEST, taking 12-month returns to 48%.
Helia Group reports 38% lift in first-half profit, raises FY25 guidance
The news: Mortgage insurance provider Helia Group posted a 38% lift in half-year net profit after tax to $133.7 million, and raised its full-year guidance, but warned of ongoing challenges in securing new business.
The numbers: The result compared to $97 million in the prior corresponding period, and $110.62 million expected by analysts, according to Visible Alpha data.
Helia's gross written premium (GWP) rose 28% to $109.9 million, as total insurance revenue fell 6% to $182.2 million.
The company declared an interim dividend of 16 cents per share, up 7% compared to the prior corresponding period, and an interim special dividend of 27 cents per share.
Full-year insurance revenue is now expected to be within a range of $350 million to $390 million, having previously guided a range of $310 million to $390 million.
The context: Helia warned that the company is "facing challenges" in its outlook for new business. It flagged that the federal government has announced a proposed expansion of the Home Guarantee Scheme, which is likely to be used by the "vast majority" of owner occupier first home buyers from FY26.
First home buyers represented 25-30% of Helia's GWP in the first half of FY25. The company said the expansion of the Home Guarantee Scheme has already had a "significant impact" on the lenders mortgage insurance industry.
The group announced a "comprehensive business review" earlier this year due to the expected termination of two major lenders mortgage insurance contracts with Commonwealth Bank and ING.
The source: ASX
