NZF posts large profit increase

Mortgage broking and finance company New Zealand Finance Holdings Ltd (NZF) today posted a 43.7 per cent increase in first half profit.

The company, which listed on the sharemarket in October last year, said its net after tax profit in the six months to September 30 was $1.7 million, compared with $1.2 million a year earlier.

The previous corresponding half-year did not include any contribution from New Zealand Mortgage Finance, which was acquired on March 31 last year.

Total revenue climbed 49 per cent to $5.67 million.

"NZF continues to experience steady demand for its lending products and the quality of the loan book is high," the company said.

The mortgage broking operation showed solid growth over the last six months and the performance of the newly acquired Approved Mortgage Brokers had exceeded expectations.

Franchise sales grew 60 per cent during the first half.

The company will pay a dividend of 0.5 cents per share on November 18.

Shares in NZF last traded at $1.05 on October 19, against a year high of $1.08 and a low of 34c.

The lending sector appears to be in reasonable health, despite predictions of a downturn in the economy.

Lending minnow Dominion Finance yesterday reported a 7 per cent rise in first-half net profit to 4.14 million.

Dominion lends to a range of industries, including property developers. Its shares were trading down a cent at $1.25 today.

Speculation is rife of consolidation in the sector as firms band together to cope with the slowdown.

- NZPA