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Prospa Group Limited has released a trading update for the quarter ended 31 March 2023, reporting lifts in originations and closing gross loans.
Prospa delivered originations of $172.8 million for this quarter, a rise of 0.5 per cent on the previous corresponding period, from $172 million, with the company reportedly experiencing solid demand across Australia and New Zealand.
According to the group, New Zealand originations contributed $35.1 million for 3Q23, with the Business Line of Credit product gaining momentum, representing 14 per cent of the New Zealand portfolio mix.
In addition, a demand for funds resulted in Prospa’s closing gross loans for the quarter rising to $890.4 million, up 52.6 per cent on the same period last year, where it sat at $583.6 million, assisted by an increase of 5.1 per cent in active customers when compared to 2Q23, bringing the total number of customers up to 20,900 (an increase of approximately 1,000 customers).
Furthermore, the lender reported that revenue for the quarter increased by 63 per cent on the previous corresponding period, reaching $74.8 million (up from $45.9 million).
The group stated that its focus remains on the “overall credit quality of the loan book” in the current economic environment, with a particular focus on tightening portfolio management settings and provisioning remains elevated.
Prospa co-founder and chief executive Greg Moshal commented on the results: “The March quarter delivered stable top-line growth, aided in part by the maintenance of our portfolio yield.
“While it’s pleasing to see the Company continue to grow, we have proactively revised our credit-risk assessment policies as sustained economic pressures on small businesses have led to some stresses beginning to materialise across the loan book.
“We remain focused on sustainably growing our business and have reviewed our operations and priorities to take proactive measures to reduce costs and capital investment.”
As for Prospa’s future outlook, it anticipates a “period of continued economic uncertainty” that’s impacted the small-business sectors across Australia and New Zealand, as it continues to focus on providing small businesses support through targeted lending.
“We will sharpen our focus on delivering those aspects of our product roadmap that deliver the most value for our customers and partners, ensuring our business retains its leading position,” Mr Moshal concluded.
In its trading update for the half year ended 31 December 2022, Prospa reported that its total originations increased to $425.5 million, up 35.1 per cent on the previous corresponding period.
[RELATED: Prospa’s total originations up 35% for 1H23]
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