Overview of Prospa Group's 1H24 financial results

Prospa Group Limited (ASX: $PGL) has released its Half Year Results for 2024, showcasing a 27.4% decrease in originations compared to the previous corresponding period. Despite this, the company reported a 7.4% increase in revenue, reaching $145.4 million for the half year. The EBITDA stood at $13.7 million, a significant improvement from the $0.2 million reported in the first half of the previous year. Operating cash flow decreased by 19.5% to $37.9 million from $47.0 million in 1H23.

Executive commentary on financial performance and strategic focus

Prospa's performance in the first half of 2024 reflects our proactive credit and operational management to ensure sustainable profitability. Despite the 27.4% decrease in originations, we have seen a strong uptake of revamped premium customer offerings, contributing to the 7.4% increase in revenue. Our focus on credit quality has driven subdued outcomes, with yield maintenance enabling sustained revenue despite a smaller portfolio. We continue to balance growth with operational efficiency, as evidenced by the reduction in total employee and operating expenses to 34.7% of revenue, showcasing our commitment to sustainable growth.

Summary of 1H24 financials and future outlook

Prospa Group's 1H24 financial results demonstrate a strategic focus on credit quality, operational efficiency, and sustainable profitability. Despite the decrease in originations, the company has managed to increase revenue and improve EBITDA, showcasing resilience in a challenging economic environment. Looking ahead, Prospa aims to complete the replatform, expand its partner value proposition, and build affinity with repeat customers in the second half of FY24. The company has also entered into a Scheme Implementation Deed with a consortium led by Salter Brothers Tech Fund Pty Ltd, indicating potential future developments. Prospa's commitment to sustainable growth and proactive management positions the company well for the future.