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SP

STANDARD PREMIUM FINANCE HOLDINGS, INC. (SPFX)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 revenue was $3.12M, with income before taxes of $0.35M and net income of $0.26M; basic and diluted EPS were $0.08 and $0.06, respectively .
  • Sequentially, revenue rose vs Q1 2025 ($2.90M → $3.12M), but net income fell ($0.34M → $0.26M) as credit loss provisioning and commissions increased; year-over-year, revenue was flat while net income declined (Q2 2024: $0.33M) .
  • Cost of funds improved materially (line-of-credit rate 7.07% vs 8.08% last year), aiding interest expense; ROE was 14.98% (vs 23.87% YoY) and originations were stable (~$40.3M) .
  • Capital allocation was a positive catalyst: board expanded the $250k repurchase program to include open-market purchases following Q2 results; the revolving credit facility was also raised to $50M, supporting growth capacity .
  • Wall Street consensus (S&P Global) for EPS and revenue was not available for SPFX; therefore no beat/miss assessment can be made (S&P Global consensus unavailable)*.

What Went Well and What Went Wrong

What Went Well

  • Improved funding costs: interest expense decreased YoY by 7.7% in Q2 (line-of-credit rate 7.07% vs 8.08% last year), supporting net interest spread even as the portfolio grew .
  • Stable originations and portfolio growth: Q2 originations were $40.32M (vs $40.36M YoY), and premium finance receivables net rose to $70.06M from $63.86M at year-end, underpinning future interest income .
  • Management confidence and shareholder returns: “expanded repurchase program reinforces our...ability to execute on a compelling growth trajectory,” and “flexible mechanism to return value to shareholders” . CEO added, “expand our national footprint...drive sustained performance” .

What Went Wrong

  • Profitability compression: net income fell YoY to $0.26M (from $0.33M) and income before taxes decreased to $0.35M (from $0.44M), with ROE at 14.98% vs 23.87% last year .
  • Higher commissions and provisioning: commissions rose YoY (+25.1%) on competitive agent dynamics; provision for credit losses increased (+28.5%) alongside portfolio growth .
  • Elevated past-due balances at carriers: past-due “due from insurance carrier” totaled $4.55M at Q2 2025, requiring disciplined collections and contributing to reserve needs .

Financial Results

MetricQ2 2024Q1 2025Q2 2025
Total Revenue ($USD)$3,119,300 $2,896,133 $3,115,824
Finance Charges ($USD)$2,718,138 $2,530,256 $2,756,924
Late Charges ($USD)$301,392 $275,507 $258,218
Origination Fees ($USD)$99,770 $90,370 $100,682
Income Before Taxes ($USD)$435,240 $438,033 $345,468
Net Income ($USD)$327,452 $335,829 $258,087
Basic EPS ($USD)$0.11 $0.10 $0.08
Diluted EPS ($USD)$0.09 $0.08 $0.06
Return on Equity (%)23.87% 20.99% 14.98%

Segment breakdown: single operating segment (insurance premium finance); no separate segment reporting .

KPIs

KPIQ2 2024Q1 2025Q2 2025
Originations ($USD)$40,355,061 $37,606,597 $40,324,340
Interest Earned Rate (%)17.58% 18.10% 18.12%
Cost of Funds Rate, Gross (%)8.02% 6.96% 7.18%
Cost of Funds Rate, Net (%)6.53% 5.19% 5.47%
Reserve Ratio (%)2.43% 2.66% 2.66%
Provision Rate (%)0.75% 0.64% 0.97%
Return on Assets (%)1.71% 1.84% 1.31%
Return on Equity (%)23.87% 20.99% 14.98%

Balance sheet context (capacity and liquidity)

  • Premium finance contracts and related receivable, net: $70,062,142 at Q2 2025 .
  • Line of credit principal outstanding: ~$44.41M at Q2 2025; availability $5.59M .
  • Working capital surplus: $14,733,266 at Q2 2025 .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Stock Repurchase AuthorizationThrough Nov 2, 2025Up to $250,000; privately negotiated transactions Expanded to include open-market repurchases per safe harbor Raised/Expanded
Revolving Credit FacilityCurrent$45,000,000 capacity Increased to $50,000,000 capacity (May 21, 2025 amendment) Raised
Funding Cost Outlook2025Elevated rates in 2024 Lower benchmark rates adopted at end-2024; line-of-credit at 7.07% Q2 2025 Improved
Revenue/EPS/Margins Guidance2025Not providedNot providedMaintained “no formal guidance”
Dividends (Preferred)Quarterly7% APY preferred dividends; $29,050 quarterly Declared/paid Q2 $29,050; cumulative schedule maintained Maintained

Earnings Call Themes & Trends

No Q2 2025 earnings call transcript was filed; themes tracked via MD&A and press releases.

TopicPrevious Mentions (Q2 2024, Q1 2025)Current Period (Q2 2025)Trend
Funding Costs/Rate EnvironmentLOCR at 8.08%; elevated benchmarks in 2024 LOCR at 7.07%; management notes Fed decreases lowering market rates Improving
Originations/ProductionQ2 2024 originations $40.36M; Q1 2025 $37.61M Q2 2025 $40.32M (stable YoY/sequential recovery from Q1) Stable to modestly improving
Credit Quality/ReservesReserve ratio 2.43%; provision rate 0.75% (Q2 2024) Reserve ratio 2.66%; provision rate 0.97% (Q2 2025) Tightening reserves amid portfolio growth
ROE/ProfitabilityROE 23.87% (Q2 2024); 20.99% (Q1 2025) ROE 14.98% (Q2 2025) Down vs strong 2024, pressure in Q2
Capital AllocationNo buyback program in place (FY 2024) $250k program announced 5/27; expanded to open market 7/31 Positive

Management Commentary

  • CEO (press release): “As we continue to expand our national footprint...build on our operating strengths...drive sustained performance for our shareholders.”
  • CFO (press release): “Improved cost of funds and careful expense management have positioned us to continue delivering value across market cycles.”
  • CEO (repurchase expansion): “The expanded repurchase program reinforces our continued confidence...and our ability to execute on a compelling growth trajectory.”

Q&A Highlights

No Q2 2025 earnings call transcript was available for SPFX; no Q&A disclosures found [ListDocuments returned none for earnings-call-transcript for SPFX].

Estimates Context

  • S&P Global consensus EPS and revenue estimates for Q2 2025 were not available for SPFX; as a result, we cannot classify the quarter as a beat/miss on consensus (S&P Global consensus unavailable)* [GetEstimates returned no data].

Key Takeaways for Investors

  • Funding tailwind: the decline in funding rates (SOFR-linked LOCR) is beginning to flow through interest expense; watch for incremental spread expansion if rate trajectory continues lower .
  • Production resiliency: originations held stable YoY and recovered sequentially; with credit facility lifted to $50M and remaining availability, SPFX retains capacity to support growth .
  • Profitability trade-offs: higher commissions and provisioning constrained net income despite better funding costs—track agent incentives and credit performance to gauge margin recovery .
  • Credit vigilance: elevated past-due carrier balances and higher reserve ratio warrant ongoing monitoring; sustained collections discipline is critical to protect earnings quality .
  • Capital return: the expanded repurchase program is an immediate shareholder-friendly action and signals management confidence; scale is modest but direction is positive .
  • Geographic concentration: Florida exposure (~66% of business) concentrates regional risk; diversification progress should be part of the medium-term thesis .
  • Near-term setup: absent Street coverage, stock reaction will hinge on internal execution (originations, funding cost trends) and follow-through on capital actions; medium term, incremental licensing and M&A optionality could enhance scale economies .

* Values retrieved from S&P Global. S&P Global consensus data was unavailable for SPFX for Q2 2025 (no estimates returned).