10 June 2014- final results
The AIM quoted finance group has announced its preliminary results for the year to 31 March revealing that significant progress has been made during the year. Group pre-tax profits have risen by 50% to £1.25m with earnings per share some 27% higher at 1.4p. There is no dividend although the company hopes to be in a position to declare a dividend after March 2015. Net assets at the company have risen by almost 12% to £10.4m and this compares with a market capitalisation of just £5.6m. The total portfolio rose by almost 11% to £88.7m with a 20% increase in new business volumes to £50.8m. The quality of the loan portfolio continues to improve resulting in a record low level of arrears and the group has £14.4m of headroom in its debt facilities to fund future growth. The group’s return on average assets, its key performance metric, has risen to 1.5% from 1.0% and this is well on the way to achieving the target of 2% set for the end of the year. The group’s most important strategic objective is to obtain a banking licence and progress in this regard continues to be made with completion timetabled for next March. This would be an important step for the group allowing it to diversify and increase its funding which would allow significant growth in its loan book with a substantial effect on profitability. The shares are a BUY.