1pm Plc (LON:OPM) (OPM, 0.05p, £1.50m), the provider of asset finance facilities to SMEs, reports prelims to 31 May 2010. Revenues remained stable at £1.3m (2009: £1.4m), but a significant increase in bad debt write-offs to £0.35m (2009: £0.08m), due to the termination of a number of lease agreements from customers going into bankruptcy, drove the group into pre-tax losses of £0.4m from a break-even point the previous year. Even after excluding the bad debts and provisioning operating profit still fell to £0.017m (2009: £0.1m). We are disappointed by the performance. The group have stricter criteria in place to ensure bad debts are kept to a minimal. The business is debt free with net cash of £0.31m (2009: £0.002m) following the £1.5m placing. Trading in H2 did improve and at the end of the year the group has a total loan book £6.55m. The placing in March 2010 has helped increase the loan book to £7.4m at the end of July 2010. The level of new business is improving. However, the Board state the “challenge remains accessing funds to support portfolio growth and to that extent we are in constructive discussions with a number of funders.” We believe trading will continue to be tough in the current environment. We are not currently comfortable with the group’s net cash position given its level of cash burn. The group need to add debt to the balance sheet or need to return to the market for more money. 

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