FlexiGroup's outlook misses expectations

The financial services group posts double-digit growth for 2012-13, and expects more of the same for the current financial year.

FlexiGroup (FXL) has exceeded its earlier guidance with its full-year net profit for 2012-13 but investors may not warm to its outlook for 2013-14.

The financial services group lifted net profit by 18% to $71.2 million, above its half-year guidance for 11-16% and slightly higher than analyst estimates for $70.7 million.

For the current financial year FlexiGroup is targeting net profit growth of 17-19% to between $84 million and $86 million. However, analysts are on average anticipating 23% growth to $87.7 million. 

Further, FlexiGroup's one-year forward price-earnings (P/E) ratio is at 15.8 times, above its five-year average of 11.5 times and higher than its peers' 14.4 times.

FlexiGroup's share price has also risen 46.8% to $4.64 over the past year, surpassing brokers' average target price at $4.58.

The company lifted its dividend to 7.5 cents a share, one cent higher than the previous year and at the top of its 50-60% payout range.

Revenue was at $284.1 million, below analyst estimates for $293.8 milllion.

FlexiGroup said 2013-14 would be underpinned by a full year of sales volume from recently acquired Once Credit, greater penetration across retail and small-to-medium enterprise accounts from its new business model, new products and services and synergies between Once Credit and Lombard.