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Wisr originations jump 90%, profit falls

by Hannah Dowling5 minute read

The neo-lender has reported a $12.9 million loss in the six months to 31 December 2019, despite seeing its loan originations almost double year-on-year.

Wisr has released its financial results for the first half of the 2020 financial year (1HFY20), announcing a 90 per cent increase in loan originations year-on-year to $54.9 million.

The figure also represents a 35 per cent increase when compared with the results of the second half of the 2019 financial year (2HFY19). 

Total loan originations hit $163.8 million as at 31 December 2019, while Wisr’s current loan book sits at $114.0 million.

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Revenue for the six-month period increased by 83 per cent when compared with the previous corresponding period to $2.2 million at 31 December 2019, up from $1.2 million at 31 December 2018.

Overall, the company recorded a loss of $12.9 million, a 272 per cent increase on the loss of $3.5 million in 1HFY19.

Wisr attributed this loss to “increase in staff and marketing costs” of $4.3 million and $1.7 million, respectively.

As of November 2019, Wisr has transitioned away from a predominantly off-balance sheet funding model to a warehouse funding model, backed by National Australia Bank.

According to the lender, the new model should see Wisr triple its average margin when compared with previous loan unit economics, and the warehouse funding will be its primary model of source funding going forward.

Commenting on the results, Wisr chief executive Anthony Nantes said: “H1FY20 has been the most impactful and pivotal half of the company’s history.

“With previous years spent building a strong foundation of market-leading technology and proving our innovative lending model, in this half we reached a turning point in the company’s strategic plan with our ‘mature state’ debt funding facility becoming operational in November.”

Mr Nantes noted that increased average margin on each loan written following the warehouse partnership with NAB, the high-quality credit standards of Wisr’s customer base and the growth of loan originations in the half-year as a foundation for growth.

He continued: “Our management team has delivered on all strategic goals for H1FY20, and the team remains energised and committed to strive for ongoing success throughout the remainder of the year and beyond.”

The chief executive stated that the financial services sector is set to see “substantial change” in 2020, and the Wisr is “primed to take advantage”, following a recent $33.5 million capital raise.

“There is an opportunity for Wisr to build a company of significant scale, purpose and profitability in a way that hasn’t been done before, and we are excited about the path ahead of us – especially on the back of what we delivered in this most recent half,” Mr Nantes concluded.

[Related: Wisr sees 36% increase in loan originations]

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Hannah Dowling

Hannah Dowling

AUTHOR

Hannah Dowling is a journalist for The Adviser and Mortgage Business.

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