Motor Trade Finance has recorded a rise in half-year sales and market share, but the underlying profit for the company headquartered in Dunedin has fallen 3.4% to $3.7million.
While after-tax profit for the half year to March was $4.4million, including an unrealised gain on the fair value of financial instruments of $600,000, without the fair value component, the underlying after tax profit decreased 3.4% from a year ago to $3.7 million.
Net interest income rose 7.1% to $25.8million.
Chief executive Glen Todd said in a statement the vehicle industry had been experiencing record new and used car sales, booking a 5.9% increase in the first quarter of the year, with no signs of it slowing.
``Throughout this sustained boom, MTF has been able to increase its share of the finance market,'' he said.
MTF originators are made up of a network of 261 car dealers which sell motor vehicles in conjunction with financial services, and 43 MTF franchises which only sell financial services, BusinessDesk reported.
Last November, MTF announced a partnership with Turners Ltd to provide a non-recourse offering to its originators, which allows MTF franchisees and dealers to sell vehicles to people with higher credit risk.
A pilot was launched in early December with a progressive roll-out from January once the lessons from the pilot were applied.
The uptake has ``significantly exceeded expectations'' and sales have exceeded $25million since December 1, MTF said yesterday.
MTF said its market share rose to 12.9% in the six months to the end of March versus 11.4% in the previous period.
Its total assets increased 5%, or by $31.6million, on the back of significantly improved sales. Assets under management totalled $645million as at March 31.
Communication and processing expense increased 22% due to targeted multimedia advertising campaigns, delivery of loan origination training and compliance programmes, and the provision of improved and more efficient technology, MTF said. - Additional Reporting: BusinessDesk
