Lenders mortgage insurance (LMI) provider Helia Group Limited has announced its financial results for the year ended Dec. 31, 2024 (FY24), reporting a statutory net profit after tax (NPAT) of $231.5 million, down 16% from the prior year.
Underlying NPAT also declined by 11% to $220.9 million. The company attributed the gap between statutory and underlying NPAT to unrealised mark-to-market gains on infrastructure and equity investments.
The board declared a fully franked final ordinary dividend of 16 cents per share and a fully franked special dividend of 53 cents per share. Both dividends are set for payment on April 3, 2025, to shareholders on record as of March 20, 2025.
Gross written premium (GWP) increased by 6% year-on-year to $195.6 million, supported by higher lending volumes for loans with a loan-to-value ratio (LVR) above 80% and an increase in Helia’s LMI market share.
However, insurance revenue declined by 9% to $389.2 million, reflecting the lower GWP levels from prior periods and less favourable variations in premium experience.
The company’s total incurred claims remained negative at -$37.2 million due to strong delinquency cure rates, appreciation in property values, and high policy cancellation rates.
However, new delinquencies rose by 17% compared to the previous year, driven by increased mortgage costs and financial pressures on borrowers. Closing delinquencies increased by 12%, although cure rates remained stable.
Helia’s insurance service result fell 19% to $291.9 million, while the net financial result declined by 7% due to lower realised and unrealised investment gains. The net investment return for the year was 4.9%, slightly lower than in FY23.
Helia maintained a 100% contract renewal success rate in 2024 and supported more than 31,000 borrowers in purchasing homes.
The company launched a multi-year marketing initiative, “LMI Lets Me In,” aimed at educating homebuyers, mortgage brokers, and lenders on the role of LMI.
The federal government’s Home Guarantee Scheme (HGS) continued to influence the LMI market, representing 38% of insured or government-backed lending. Helia stated it remains engaged with policymakers to provide input on the scheme’s impact and potential refinements.
On the operational front, the company integrated six new customer APIs and introduced a digital onboarding system to improve service delivery. Helia also reported an employee engagement score of 78%.
Helia expanded its capital return program, approving an increase in shareholder distributions. The company boosted its share buy-back program from $100 million to $200 million, with $121 million still available for repurchases.
The company’s PCA (prescribed capital amount) coverage ratio stood at 2.10 times at year-end, up 24 basis points from FY23. Helia aims to maintain a coverage range of 1.40 to 1.60 times the Australian Prudential Regulation Authority’s (APRA) required capital levels.
Following dividend payments and remaining buy-back transactions, the company estimates a pro forma PCA coverage ratio of 1.73 times.
Commenting on the company’s latest financial performance, Helia chief executive officer and managing director Pauline Blight-Johnston said: “I am pleased that our strong financial performance and capital position continue to provide us with the flexibility to support our customers, invest in strategic initiatives, and undertake disciplined capital management.”
For the 2025 financial year, Helia expects insurance revenue to range between $310 million and $390 million. The company anticipates its total incurred claims ratio to remain below its long-term average of approximately 30%.
Helia stated that its priorities include sustaining its market position, improving operational efficiencies, and monitoring economic conditions that could impact mortgage default rates.
