SYDNEY – Helia, the leading lenders mortgage insurer, has reported a significant increase in its interim profit. The company’s strong performance can be attributed to a favorable claims environment and higher investment income. However, it also experienced a decline in new business volumes during the half-year period.
Helia announced that its net profit for the six months ending in June reached 147.5 million Australian dollars (US$94.6 million), more than doubling from the previous year’s figure of A$57.7 million. On an underlying basis, Helia recorded a profit of A$137.2 million, representing a 32% increase compared to the previous year.
The company’s directors have declared an interim dividend of 14 Australian cents per share, up from 12 Australian cents in the corresponding period in 2022.
Furthermore, Helia’s board has approved a new share buyback program valued at up to A$100 million, set to commence in September. This decision was made considering the strong capital position of the company. However, Helia reserves the right to vary, suspend, or terminate the buyback at any time.
While gross written premium declined by 49% to A$96.6 million compared to the previous year, the new insurance written experienced a significant decrease of 45%, totaling A$6.2 billion.
Chief Executive Pauline Blight-Johnston commented on this decline, stating that “new business volumes over the half have been soft, driven by a cyclical low in new high loan-to-value ratio mortgage lending as well as the increased impact of the Federal Government’s First Home Guarantee scheme.”
Looking ahead, Helia expects its insurance revenue for fiscal year 2023 to fall within the range of A$420 million to A$460 million.
The company anticipates that delinquencies will respond to expected modest increases in unemployment and higher interest rates, which may also impact dwelling values. Helia projects that total incurred claims will gradually increase toward long-term average levels throughout the second half of fiscal year 2023 and fiscal year 2024.
In November, the company changed its name from Genworth Mortgage Insurance Australia to Helia to reflect its evolving business focus.