REG - Lendinvest PLC LendInvest PLC-LINV - Trading Update

LendinvestAnnouncement

13/04/2023 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20230413:nRSM0365Wa&default-theme=true

RNS Number : 0365W  Lendinvest PLC  13 April 2023

 

LEI: 213800NWMK3O4UWP9N91

13 April 2023

 

LendInvest plc

FY 2023 Trading Update

LendInvest plc (AIM: LINV; "LendInvest"), the UK's leading platform for
mortgages, announces its trading update for the year ended 31 March 2023,
ahead of its full year results announcement in mid-July 2023.

Highlights:

                         31 March 2023  31 March 2022  Growth  30 September  Growth

(£m)
(£m)
(%)
2022
(%)

(£m)
 Platform Assets under   2,587.0        2,146.1        +20.5   2,431.1       +6.4

Management

("Platform AuM")
 Funds under Management  3,605.9        2,483.6        +45.2   3,442.1       +4.8

("FuM")

 

 

●    Platform AuM increased by 20.5% year-on-year, and by 6.4% in H2,
driven by growth across all our key product categories (professional
buy-to-let, bridging and development finance). The pace of growth began to
slow towards the end of H1 as the Bank Rate continued to increase. This was
compounded by the market reaction to the Government's Growth Plan (also known
as the mini-budget) in late September 2022.

●      FuM increased by 45.2% year-on-year and by 4.8% in H2. We
continue to see resilient demand from a wide range of sophisticated investors
for funding loans originated on our platform. We have maintained our lending
headroom at more than £1 billion to support our borrowers when market
conditions improve.

●    Launched our first residential mortgage products, bringing our
technology-driven model to this £1.7 trillion* market for the first time. Our
initial Residential Mortgage product range is aimed at borrowers with multiple
sources of income, the self-employed and small-business owners. Lloyds Bank
increased its funding to us by £120 million (to £300 million in total) to
support this new growth vector.

●    HSBC is providing up to £100 million in funding, together with the
British Business Bank via its government-backed ENABLE Guarantee programme, to
fund our development finance products, allowing us to continue to support
home-building and alleviate the undersupply of housing in the UK.

 

●    Successfully completed the sale of our residual economic interest in
the Mortimer BTL 2020-1 securitisation for £7 million, in line with our
strategy to optimise FuM while selectively moving assets off balance sheet.

 

●    Launched our Mortgage Tech Meetup event series, bringing together
property and technology experts from across the industry with our mortgage
technology specialist team to discuss the future of mortgage technology and to
provide a framework for market participants to deliver much-needed innovation
in the UK mortgage space.

Rod Lockhart, Chief Executive Officer of LendInvest, said:

"We have continued to deliver on the commitments we laid out at our IPO. We
are growing and optimising our FuM accessing strong demand from some of the
world's largest and most sophisticated financial institutions. We are
expanding our Platform AuM and we are continuing to invest in our technology
platform to further strengthen our competitive advantage as a
technology-driven lending and funding platform for mortgages. We also
celebrated a landmark for LendInvest with our entry into the UK residential
mortgage market, leveraging our success and track record in professional
buy-to-let, bridging and development finance. Our proprietary technology is
now available to help individuals with multiple sources of income, or the
self-employed, and small-business owners, to secure a mortgage, meeting the
needs of a large, underserved segment of the market.

"While we remain mindful of the macroeconomic backdrop, we have confidence in
our growth strategy. Our technology enables us to continue developing
disruptive new solutions in existing and new parts of the mortgage market,
giving us a competitive edge with brokers and borrowers and helping us to
continue to attract diverse sources of capital."

Current trading and outlook

The Board expects to announce results for the year ended 31 March 2023 in-line
with market expectations.**

As we progressed through the second half of the financial year, mortgage rates
eased from their highs of October 2022 which marginally improved confidence.
More than 1.4 million households in the UK are facing the prospect of interest
rate rises when they renew their fixed rate mortgages in 2023. We have seen a
shift, with an increase in borrowers opting for tracker mortgages which
provide greater flexibility to remortgage if rates reduce.  Some of our
commercial borrowers are seeing the weaker property market as a buying
opportunity and in March we recorded our highest ever level of applications
for bridging loans.

Despite ongoing economic uncertainties our technology provides us with a
competitive advantage and an opportunity to win market share. We have £1
billion in lending headroom which provides opportunities for continued growth
in the year ended 31 March 2024. Our recent launch into residential mortgages
will continue to ramp up and provide a tremendous long-term growth opportunity
as we leverage our technology to make even the most complex of mortgage
applications simpler and faster for a neglected customer base.

Source:

*FCA -The outstanding value of all residential mortgage loans was £1.7
trillion at the end of Q4 2022.

** Market expectations for profit before tax for the year ended 31 March 2023:
£14.3 million based on current forecasts from 3 analysts.

 

 

 

 

Enquiries:

 Rod Lockhart, Chief Executive Officer                                    +44 (0)20 7353 4200

 Michael Evans, Chief Financial Officer

 Alex Dee, Head of Investor Relations

 Leigh Rimmer, Head of External Communications

 investorrelations@lendinvest.com
 Panmure Gordon (NOMAD and Joint Broker)                                  +44 (0)20 7886 2500

 Atholl Tweedie / Stephen Jones / Tom Scrivens
 finnCap Limited (Joint Broker)                                           +44 (0)20 7220 0500

Jonny Franklin-Adams / Tim Redfern

 Teneo (Financial PR)                                                     +44 (0)20 7353 4200

 Tom Murray / Ed Cropley / Olivia Lucas

 

About LendInvest

LendInvest is a leading platform for mortgages in the United Kingdom. Since
inception we have developed proprietary technology and digital solutions that
have allowed us to capture market share from incumbents and attract
significant third-party capital.

We use our technology to disrupt the £1.7 trillion* property finance market
which is dominated by manual paper processes and poor customer experience. Our
platform, unencumbered by legacy systems, offers attractive products and
pricing to borrowers and intermediaries through a seamless and
customer-focused process. In addition, it also provides us with a highly
scalable origination platform for future growth.

Experts in Real Estate investment, we have designed a variety of solutions and
products for our investors. These range from funds and separate accounts to
financial partnerships and RMBS. These products are tailored to address their
specific risk return and investment criteria. Through the platform, investors
from around the world gain exposure to attractive UK property finance assets
without requiring them to establish direct lending operations or borrower
services.

Our innovative business model is underpinned by our proprietary end-to-end
technology infrastructure, which facilitates operating leverage and delivers
better pricing for our customers. This drives efficiency and underpins our
business' roadmap for growth.

Source:

(*)FCA -The outstanding value of all residential mortgage loans was £1.7
trillion at the end of Q4 2022.

Glossary

Platform AuM

We define Platform AuM as the sum of (i) the total amount of outstanding loans
and advances (including accrued interest, and gross of impairment provisions
and fair value adjustments), (ii) off-balance sheet assets, which represents
the total amount of outstanding loans and advances (including accrued
interest) that we originate but do not hold on our balance sheet, comprising
those loans that are held by our off-balance sheet entities. Off-balance sheet
assets are not presented net of any impairment provisions relating thereto.

The directors of LendInvest view Platform AuM as a useful measure because it
is used to analyse and evaluate the volume of revenue generating assets of the
platform on an aggregate basis and is therefore helpful for understanding the
performance of the business.

FuM

We define FuM as the aggregate sum available to us under each of our funding
lines. FuM is used to originate revenue generating AuM. The directors of
LendInvest view the difference between FuM and Platform AuM as the headroom
for future growth.

Forward-looking statements

Certain statements in this announcement are forward-looking statements. In
some cases, these forward looking statements can be identified by the use of
forward looking terminology including the terms "anticipate", "believe",
"intend", "estimate", "expect", "may", "will", "seek", "continue", "aim",
"target", "projected", "plan", "goal", "achieve" and words of similar meaning
or in each case, their negative, or other variations or comparable
terminology. Forward-looking statements are based on current expectations and
assumptions and are subject to a number of known and unknown risks,
uncertainties and other important factors that could cause results or events
to differ materially from what is expressed or implied by those statements.
Many factors may cause actual results, performance or achievements of
LendInvest to be materially different from any future results, performance or
achievements expressed or implied by the forward-looking statements. Important
factors that could cause actual results, performance or achievements of
LendInvest to differ materially from the expectations of LendInvest, include,
among other things, general business and economic conditions globally,
industry trends, competition, changes in government and changes in regulation
and policy, changes in its business strategy, political and economic
uncertainty and other factors. As such, undue reliance should not be placed on
forward-looking statements. Any forward-looking statement is based on
information available to LendInvest as of the date of the statement. All
written or oral forward-looking statements attributable to LendInvest are
qualified by this caution. Other than in accordance with legal and regulatory
obligations, LendInvest undertakes no obligation to publicly update or revise
any forward-looking statement, whether as a result of new information, future
events or otherwise. Nothing in this announcement should be regarded as a
profit forecast.

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  TSTEAPLAFFDDEFA