REG - Vector Capital PLC - Half Year Trading Update and Loan Book Summary

Vector CapitalAnnouncement

18/07/2023 07:00

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RNS Number : 2762G  Vector Capital PLC  18 July 2023

18 July 2023

Vector Capital Plc

("Vector Capital", the "Company" or the "Group")

Half Year Trading Update and Loan Book Summary

"Trading in line with expectations utilising Vector Capital's strong capital
base"

Vector Capital Plc (AIM: VCAP), a commercial lending group that offers secured
loans to property developers and investors in England & Wales, is pleased
to provide a half-year trading update for the period ended 30 June 2023 and a
loan book summary as at the same date.

Trading update

As indicated in our 2022 Annual Report, 2023 is a year of consolidation where
the Company plans to strengthen its position in a lending market which
continues to be impacted by increasing interest rates, soft property prices
and persistent inflation.

Vector Capital's strong capital base, with share capital and reserves as at 31
December 2022 of £25.1m, representing 55.4 pence per share, together with
competitively priced borrowings of £4m advanced from its parent, Vector
Holdings Limited, means that the Company is very well placed to withstand
these challenging market conditions. This financial stability is reinforced by
the Company's excellent relationships with its introducer broker network and
the continued appetite to provide funding from its wholesale and specialist
lender contacts. Overall, the Board is pleased to announce that at the half
year the Company is trading in line with market expectations.

Given market conditions, the Company remains cautious in assessing new lending
opportunities. However, new business enquiry levels and the pipeline remain
strong, despite higher interest rates impacting borrower affordability.
Redemptions continue to be applied in new customer advances on a regular
basis.

Loan book summary

As summarised below, the Company's loan book at 30 June 2023 was £49.0m,
reflecting aggregate planned redemptions of £11.8m and new loans advanced of
£7.6m during the six-month period. The overall average loan to value at the
period end was 58.3%.

                        As at 30/06/23  As at 31/03/23  As at 31/12/22
 Loan book              £49.0m          £48.4m          £53.2m
 Number of live loans   103             102             107
 Average loan size      £476,000        £475,000        £499,000
 Average loan to value  58.3%           57.1%           59.0%

The Company announced on 12(th) June that its wholesale bank debt providers
increased debt facilities by £5.0m, bringing the total wholesale bank
facilities available to £45.0m. Furthermore, that within these facilities,
the Group now has the capacity to drawdown £2.5m toward loans secured by
second charges, allowing the flexibility for cautious and selective expansion
of the Group's loan book into higher margin loan agreements. The Group has
substantial unutilised bank facilities that can be accessed when opportune.

Agam Jain, CEO of Vector Capital, commented: "We are very pleased with the
Group's trading performance in the first six months of the year, further
details of which will be presented in the interim results in the first week of
September. Our strong capital base differentiates us from many of our
competitors, while the extension and broadening of our debt facilities
provides valuable flexibility in the way that we can assess new lending
opportunities. High interest rates are now likely to be with us for a
continued period, during which time we can seek to maximise return on our own
capital and, on a selective basis, borrowed funds from our debt providers."

This announcement contains inside information for the purposes of Article 7 of
the UK version of Regulation (EU) No 596/2014 which is part of UK law by
virtue of the European Union (Withdrawal) Act 2018, as amended ("MAR"). Upon
the publication of this announcement via a Regulatory Information Service,
this inside information is now considered to be in the public domain.

For further information please contact:

 Vector Capital plc                             c/o IFC Advisory
 Robin Stevens (Chairman)
 Agam Jain (CEO)

 WH Ireland Limited                             020 7220 1666
 Hugh Morgan, Chris Hardie, Darshan Patel

 IFC Advisory Limited                           020 3934 6630
 Graham Herring, Florence Chandler, Zach Cohen

 

 

About Vector Capital:

Vector Capital provides secured, business-to-business loans to SMEs based in
England and Wales. Loans are typically secured by a first legal charge against
real estate. The Company's customers typically borrow for general working
capital purposes, bridging ahead of refinancing, land development and property
acquisition. The loans provided by the Company are typically for renewable
12-month terms with fixed interest rates.

 

 

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