Picture of Time Finance logo

TIME Time Finance News Story

0.000.00%
gb flag iconLast trade - 00:00
FinancialsAdventurousMicro CapSuper Stock

REG - Time Finance PLC - Trading Update & Notice of Final Results

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20220707:nRSG6536Ra&default-theme=true

RNS Number : 6536R  Time Finance PLC  07 July 2022

7 July 2022

 

Time Finance plc

("Time Finance", the "Group" or the "Company")

 

Trading Update and Notice of Final Results

 

Continued successful implementation of Strategic plan with Own-Book Lending
Portfolio up 19%, Own-Book Deal Origination up 36%, Net Arrears fallen by over
35%, and Net Tangible Assets of over £30m

 

Time Finance plc, the AIM listed specialist finance provider is pleased to
announce the following trading update ahead of the publication of its audited
final results for the financial year ended 31 May 2022, which are scheduled to
be announced on 22 September 2022.

 

Unaudited trading results for the year demonstrate significant progress
towards delivering the Board's medium-term strategy to significantly increase
own-book deal origination and its commercial lending and plans for the
divestment of the Group's non-core, consumer focussed brokerage businesses are
well progressed.

 

Highlights 1  (#_ftn1)

·    Own-book gross lending portfolio at 31 May 2022 of £137.8m (31 May
2021: £115.7m), an increase of 19%

·    Net Tangible Assets of £30.5m at 31 May 2022 (31 May 2021: £28.4m),
an increase of 7%

·    Nil deals in forbearance at 31 May 2022 (31 May 2021: £0.8m)

·    Net deals in arrears 2  (#_ftn2) of £7.8m at 31 May 2022 (31 May
2021: £12.2m), a decrease of 36%

·    Good visibility on future earnings with unearned income of £16.8m
(2021: £14.9m), an increase of 13%

·    Core lending: Own-Book deal origination for the year of £64.4m
(2021: £47.3m), an increase of 36%

·    Revenue for the year of £23.6 million (2021: £24.2m), a decrease of
2%

·    Profit Before Tax, Exceptional Items, Share Based payments and
Goodwill write-off ("PBTE") of £3.0m (2021: £3.1m), a decrease of 3%

·    Profit Before Tax of £1.1m (2021: £2.0m), a decrease of 45%,
reflecting the goodwill write-off of a non-core brokerage and restructuring
costs in streamlining the business

·    Supportive, long-term funding partners with unused lending headroom
in excess of £60m at year-end

 

Strategy

Time Finance's strategy is to provide the finance which UK SMEs require to
grow their businesses, with a clear focus on lending on the Group's own
balance sheet. The Group has a highly distinctive product offering, making it
a truly multi-product funding provider to UK SMEs. The Group is also able to
operate a "hybrid" lending and broking model for commercial deals which may
occasionally fall outside its usual credit criteria or where the margins are
too slim. At the same time, the Group has been looking to divest its non-core,
broked-on consumer businesses.

 

The financial year ended 31 May 2022 has seen the Group pull back from its
non-core brokerage businesses which have continued to be significantly
impacted by the effects of the COVID pandemic, while it remains focussed on
growing the commercial lending book in a safe and secure manner. As a result,
the lending book is 18% larger than as at 31 May 2021, while the volume of
deals originated for own-book lending is 36% higher than the prior year.
Importantly, a large part of this growth was achieved during the final quarter
of the financial year, indicating that the Group's re-focused strategy is
becoming embedded and is setting the business up on a solid footing for the
current financial period and beyond. This in turn provides management with a
degree of optimism as we begin the new financial year in terms of both repeat
and future revenue streams.

 

In line with the Group's re-focused strategy, the decision has been made to
close the non-core, second-hand vehicle brokerage business. Despite concerted
efforts, the business remained loss making throughout the period since the
start of the COVID pandemic and was not showing any indications of returning
to its pre-COVID business levels, depressing consolidated profits in the
financial year by c£0.3m with the dampening effect likely to continue. The
decision to close the business has resulted in an exceptional, one-off
accounting adjustment to write-off c£1m of goodwill associated with the
original acquisition. However, it also eliminates further ongoing losses being
incurred, enables more management time to be focused on the profitable parts
of the business and provides greater clarity of funding proposition coming
into the new financial year.

 

The Board also took the decision in early 2022 to streamline the Group's
management structure and reposition the team for own-book growth, with the
objective of removing infrastructure costs required for the non-core consumer
brokerages. This resulted in a one-off exceptional cost of c£0.7m and a
corresponding reduction in staff costs moving forward.

 

Ed Rimmer, Chief Executive Officer, commented:

"The Results for the year ended 31 May 2022 mark a significant first step on
the Group's journey to enacting the new strategy first announced in June of
2021. The results, while satisfactory, reflect the organic growth we
anticipated in relation to the commercial own-book lending but are impacted by
the continued underperformance of the non-core consumer brokerages and wider
macro-economic headwinds that have buffeted the UK economy over the past six
months. The changes made, combined with our renewed focus on own-book lending,
mean that the Group is now better placed to benefit from further organic
growth and we look forward to building value for our shareholders in the near-
term."

 

The Company will deliver a live presentation relating to this trading update
via the Investor Meet Company platform at 11am BST today. Existing and
potential shareholders can sign up to Investor Meet Company for free and add
to meet Time Finance plc via:
 https://www.investormeetcompany.com/time-finance-plc/register-investor
(https://www.investormeetcompany.com/time-finance-plc/register-investor)

 For further information, please contact:

 Time Finance plc
 Ed Rimmer, Chief Executive Officer          01225 474230
 James Roberts, Chief Financial Officer      01225 474230

 Cenkos Securities plc (NOMAD and Broker)    0207 397 8900
 Ben Jeynes / Max Gould (Corporate Finance)

 Julian Morse (Sales)

 Walbrook PR                                 0207 933 8780
 Paul Vann / Nick Rome                       07768 807631
                                             Timefinance@walbrookpr.com

 

About Time Finance:

Time Finance's core strategy is to focus on providing or arranging the finance
UK SMEs require to fund their businesses. It offers a multi-product range for
SMEs including asset, vehicle, loan and invoice finance. While primarily an
'own-book' lender the Group does operates a 'hybrid' lending and broking model
enabling it to optimize business levels through market and economic cycles.

 

More information is available on the Company website www.timefinance.com
(http://www.timefinance.com/) .

 

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 as amended by regulation 11 of the Market Abuse (Amendment)
(EU Exit) Regulations 2019/310. Upon the publication of this announcement
via Regulatory Information Service, this inside information is now considered
to be in the public domain.

 1  (#_ftnref1) Unaudited

 2  (#_ftnref2) Net deal in arrears include all deals in arrears aside from
"Technical" arrears, namely those less than 30 days in arrears

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  TSTGUGDRBDGDGDR

Recent news on Time Finance

See all news