Positive trading momentum maintained;
Another year of strong growth delivers record revenues and profits;
Earnings per share rise 24%; increased recommended final dividend.
1pm plc, the AIM listed independent specialist provider of finance facilities, is pleased to announce its final results for the year ended 31 May 2018.
The trading results reflect strong organic growth in revenue and profits and further strategic growth from acquisitions during the year.
The Group has continued to experience robust demand for finance from SMEs and consumers across the expanded range of products it offers. This product range now comprises Asset Finance (finance leasing and hire purchase for ‘hard’ and ‘soft’ assets and vehicles broking), Loans, and Commercial (i.e. invoice) Finance.
- Revenue for the year of £30.0m (2017: £16.9m), an increase of 78%, of which organic growth was 31%
- Profit before tax for the year of £7.9m (2017: £4.1m), an increase of 93%
- Basic earnings per share of 7.57 pence (2017: 6.09 pence), up 24%
- Dividend proposed of 0.65 pence per share (2017: 0.50 pence per share), up 30%
- Consolidated net assets at 31 May 2018 of £48.1m (2016: £28.5m), an increase of 69%
- Return on capital increased to 13.3% (2017: 11.5%)
At 31 May 2018, the Group’s combined gross lending portfolio amounted to £142.1m (2017: £89.5m), an increase of 59% principally relating to the addition of the Commercial Finance division early in the year. Portfolio write-offs, net of recoveries of previously written off receivables, amounted to £1.5m, representing approximately 1.2% of the year-end net portfolio (2017: £0.9m, also representing 1.2%). Conservative impairment provisions carried in the balance sheet at 31 May 2018 amounted to 1.5% of the net portfolio (2017: 1.3%).
- Origination of new lease, loan, vehicle and invoice finance agreements in the year amounted to £142.9m (2017: £83.0m), comprising almost 20,000 total customers across the Group, an increase of 72%
- Approximately 56% of all origination brokered to other lenders for cash commissions and 44% added to own- book lending, a similar proportion to the prior year
- Funding facilities available to lend of £162.6m (2017: £74.5m), an increase of 2.2 times. This includes a new £35m facility with the government backed British Business Bank as announced on 27 March
- Blended cost of borrowings fell 23% to approximately 4.1% (2017: 5.3%)
In addition, integration of business functions across the Group has accelerated. Origination of new leads from cross-selling the Group’s products is increasing month-on-month with £13m of leads generated in the final quarter of the financial year.
John Newman, Non-executive Chairman commented:
“We are delighted that the Group’s focus on organic growth and further strategic expansion has delivered another set of excellent annual financial results. The results demonstrate that the foundations have been laid for further growth in the current financial year and the Board is optimistic of continuing to increase value and returns for its shareholders”.
Ian Smith, Chief Executive Officer, commented:
“Our strategy of being a multi-product provider to SMEs and consumers, plus the flexibility to either fund, or broke-on, has enabled the Group to generate robust levels of demand and hence these strong results. Improving risk management, operational efficiency and further strategic expansion, together with increased funding facilities, mean the Group is well positioned to deliver great outcomes for customers and further growth for shareholders”.
A video detailing further comments and insights on the final results from Ian Smith and James Roberts can be viewed by following this link: http://bit.ly/OPM_FY18