Otago Daily Times

Heartland profit forecast may lift after Harmoney float


AUCKLAND: Heartland Group said its profit forecast for 2021 may need upward revision to reflect the value of its 8.44% stake in personal lender Harmoney, which listed on the ASX and NZX this week.

At the $A3.50 issue price, Heartland’s stake would be worth $A29.8 million ($NZ31.4 million).

In its most recent accounts, Heartland’s equity investment­s — mostly Harmoney — came to $NZ16.3 million.

Heartland said it was reassessin­g the valuation of its equity investment in Harmoney.

Heartland has entered into escrow restrictio­ns prohibitin­g the disposal of its shareholdi­ng until the occurrence of certain events.

‘‘Heartland will reassess the fair value of its equity investment in Harmoney as part of the preparatio­n of its financial results for the sixmonth period ending 31 December, 2020,’’ the company said.

In determinin­g fair value, it would take into considerat­ion the market value of Harmoney shares alongside a range of other factors.

This could result in an increase in the investment’s fair value.

Heartland said its investment in Harmoney was not significan­t in the context of its total assets.

However, as an increase would give a oneoff boost to net profit that had not been taken into account, its forecast net profit for 2021 might need to be revised.

In September, Heartland announced a fullyear net profit of $72 million, and said it expected its net profit for the June 2021 year to be in the range of $83 million to $85 million.

Harmoney on Thursday gained a primary listing on the ASX and a ‘‘foreign exempt’’ listing on the NZX. — The New Zealand Herald

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