Adrian Hargrave, CEO of SEEEN, explains how the new funds will accelerate customer growth Watch the video here.

Less Ads, More Data, More Tools Register for FREE

Pin to quick picksPCF.L Share News (PCF)

  • There is currently no data for PCF

Watchlists are a member only feature

Login to your account

Alerts are a premium feature

Login to your account

Private & Commercial Finance Profit Rises 50% As Portfolio Grows

Tue, 10th Jun 2014 06:53

LONDON (Alliance News) - Private & Commercial Finance Group PLC Tuesday said its full-year pretax profit increased by half, driven by an increase in revenue, as the AIM-listed finance house grew its portfolio for the first time since the start of the financial crisis.

It said work also is being done to obtain a deposit-taking licence that would allow the group to further boost its size.

Chairman David Anthony said he is confident of further profit growth and said the group hopes to be in a position to declare a dividend after March 2015.

In a statement, Private & Commercial Finance, which lends to consumers and businesses, said it made a GBP1.3 million pretax profit in the 12 months ended March 31, compared with GBP829,000 a year earlier.

One of the group's own key measures, return on average assets, based on the ratio of pretax profit to the average size of the group's portfolio, rose to 1.5% from 1.0% over the year. The finance house has a 2.0% target for the end of the current financial year. Chief Executive Scott Maybury told Alliance News the group is likely to set a new 3.0% target over a three-year period once the current target is met.

Revenue increased to GBP42.7 million for the year, up from GBP41.4 million, boosted by growth in both its consumer and its business lending units. New business volumes increased to GBP50.8 million, from GBP39.3 million, driven by the consumer finance division.

Administrative expenses fell to GBP6.9 million, from GBP7.2 million, as the group kept costs under control and kept average staff numbers static.

Maybury told Alliance News that the finance house has benefited from the UK's consumer-led recovery, with rising car sales, and the traditional high street lenders' retreat from lending to small and medium sized enterprises, boosted by a regulatory push to make banks de-leverage and shore up their balance sheets in the wake of the financial crisis.

At the group's interim results, Maybury had told Alliance News that he expected the group to report GBP45.0 million in full-year revenue, based on a growing its portfolio to GBP95.0 million. However, the group's portfolio increased to GBP88.7 million from GBP80.0 million, primarily because of direct sales fell short.

With new business currently won through brokers, Private & Commercial had wanted to grow its direct sales to GBP9.0 million, but instead managed about GBP1.0 million, according to Maybury. He said that the group has had some success in developing direct routes for classic car finance and horse boxes, and the strategy is seen a "nice little adjunct" to broker-originated business with efforts to continue. Maybury said Private & Commercial grew profits despite the shortcoming in direct sales as its existing business model operating better than expected.

The group has been focusing its efforts on retaining existing customers and on securing new business with higher quality credit areas, with loan-loss provisioning charges falling to GBP2.0 million from GBP2.3 million in its last financial year.

"When banks moved out of the market place, there was an opportunity to sell to the prime market," Maybury told Alliance News. "We're attracted to prime and near prime areas, and we're not going further down the credit spectrum. We're very committed to maintaining our presence in that spectrum," he added.

The group wants to continue growing its portfolio to a size of GBP250.0 million. Maybury told Alliance News that Private & Commercial's key strategic goal of obtaining a banking licence, which would allow it to fund itself with retail deposits instead of bank debt, is vital to growing its portfolio to that sort of level. The CEO told Alliance News that the project will be classified as an intangible asset to be amortised over time. He said that the group is currently conducting the research and work to design the processes and develop the operating model and policies required under the Prudential Regulation Authority's application process.

Private & Commercial Finance said it is on track to obtaining a licence in March 2015. The group currently funds its portfolio with wholesale banking debt, which is more expensive than being able to use retail deposits and can make borrowers susceptible to banks' lending appetite. Even so, Private & Commercial Finance said it will continue to approach new and existing lenders to ensure it has enough financing to support growth beyond the current financial year, having GBP14.4 million undrawn on its existing GBP96.0 million debt facility.

"We'll always have an element of it and will retain some leverage in order to boost returns," Maybury told Alliance News, "but over a three-year period we want to replace 75% of our bank debt with retail deposits."

"We will be looking at two to three year deposits," Maybury said, "but we won't be offering current accounts or credit cards." The CEO said that the lifespan of the retail deposits will match that of its portfolio, which has an average age of two to three years

By Samuel Agini; samagini@alliancenews.com; @samuelagini

Copyright 2014 Alliance News Limited. All Rights Reserved.

More News
1 Jul 2022 20:05

TRADING UPDATES: Capital wins contracts; 4D pharma pauses enrolment

(Alliance News) - The following is a round-up of updates by London-listed companies, issued on Thursday and Friday and not separately reported by Alliance News:

Read more
30 Jun 2022 13:59

EARNINGS UPDATES: UK Oil & Gas and 7digital post widened losses

(Alliance News) - The following is a round-up of updates by London-listed companies, issued on Thursday and not separately reported by Alliance News:

Read more
29 Jun 2022 15:56

UK shareholder meetings calendar - next 7 days

Thursday 30 June 
3i Group PLCAGM
Ashtead Technology Holdings PLCAGM
Borders & Southern Petroleum PLCAGM
Caspian Sunrise PLCAGM
Cobra Resources PLCAGM
Crimson Tide PLCAGM
ECSC Group PLCAGM
Evraz PLCAGM
Gresham House Energy Storage Fund PLCAGM
GRIT Investment Trust PLCAGM
Gulf Marine Services PLCAGM
Hamak Gold LtdAGM
Hemogenyx Pharmaceuticals PLCAGM
Immotion Group PLCAGM
Inspiration Healthcare Group PLCAGM
Inspired PLCAGM
Jadestone Energy PLCAGM
Kanabo Group PLCAGM
Kropz PLCAGM
Likewise Group PLCAGM
Live Co Group PLCAGM
Location Sciences Group PLCAGM
LoopUp Group PLCAGM
M&C Saatchi PLCAGM
Microsaic Systems PLCAGM
Nostra Terra Oil & Gas CoAGM
Pathfinder Minerals PLCAGM
Playtech PLCAGM
Primorus Investments PLCAGM
Rockfire Resources PLCAGM
Roquefort Therapeutics PLCAGM
Sanne Group PLCAGM
Scottish Mortgage Investment Trust PLCAGM
Serica Energy PLCAGM
Supply@ME Capital PLCAGM
Surface Transforms PLCAGM
Synairgen PLCAGM
Tower Resources PLCAGM
Trainline PLCAGM
ValiRx PLCAGM
Victoria Oil & Gas PLCAGM
Watchstone Group PLCAGM
Friday 1 July 
All Star Minerals PLCGM re name change to Marula Mining
Monday 4 July 
Active Energy Group PLCAGM
Clean Invest Africa PLCAGM
Securities Trust of Scotland PLCAGM
Tuesday 5 July 
Immediate Acquisition PLCAGM
Marks & Spencer Group PLCAGM
Open Orphan PLCAGM
Saga PLCAGM
Smartspace Software PLCAGM
Young & Co's Brewery PLCAGM
Wednesday 6 July 
Assura PLCAGM
ContourGlobal PLCGM re acquisition by KKR
GSK PLCGM re Consumer Healthcare demerger, Haleon listing
Mining Minerals & Metals PLCAGM
PCF Group PLCGM re director allotment authority
Puma Alpha VCT PLCAGM
Shires Income PLCAGM
Sirius Real Estate LtdAGM
Strategic Minerals PLCAGM
Worldwide Healthcare Trust PLCAGM
  
Copyright 2022 Alliance News Limited. All Rights Reserved.

Read more
28 Jun 2022 19:05

IN BRIEF: PCF extends takeover talks deadline with Castle Trust

PCF Group PLC - London-based specialist bank - Requests extension from Takeover Panel for talks with Castle Trust Capital PLC. Deadline for takeover talks extended to July 26. Last month, PCF had said it was in talks with Castle Trust about a possible all-share takeover offer. Castle is a London-based bank, offering savings accounts and mortgage lending.

Read more
8 Jun 2022 12:10

CORRECT: Somers raises stake in PCF to 71% as gets new takeover idea

(Correcting that Somers's stake rises to 71%, rather than 73%, due to error by PCF.)

Read more
7 Jun 2022 11:27

AIM WINNERS & LOSERS: Bowleven up on Etinde moves; LoopUp down on loss

(Alliance News) - The following stocks are the leading risers and fallers on AIM in London on Tuesday.

Read more
7 Jun 2022 11:12

Somers raises stake in PCF to 73% as lender receives new takeover idea

(Alliance News) - PCF Group PLC on Tuesday said its majority shareholder Somers Ltd has invested GBP2.7 million via a share subscription, as takeover talks continue and a new approach has been received.

Read more
31 May 2022 12:01

PCF gets takeover approach from Castle Trust Capital as Somers invests

(Alliance News) - PCF Group PLC on Tuesday said it is in talks with Castle Trust Capital PLC about a possible all-share takeover offer, while at the same time its majority shareholder has agreed to invest up to GBP4.2 million in the company.

Read more
31 May 2022 08:03

PCF in 'early stage' takeover talks with Castle Trust Capital

(Sharecast News) - PCF Group announced on Tuesday that it is in early-stage discussions with Castle Trust Capital over a possible all-share offer for the company.

Read more
15 Feb 2022 12:04

PCF shares down as loan origination drops and trading to be suspended

(Alliance News) - PCF Group PLC share price took a hit on Tuesday as it reported poor preliminary results for financial 2021.

Read more
28 Jan 2022 16:12

UK shareholder meetings calendar - next 7 days

UK shareholder meetings calendar - next 7 days

Read more
25 Jan 2022 11:42

PCF shares dive on the first day of trading resuming since May

PCF shares dive on the first day of trading resuming since May

Read more
10 Jan 2022 14:19

PCF Group appoints Simon Moore and Mark Sismey-Durrant to board

PCF Group appoints Simon Moore and Mark Sismey-Durrant to board

Read more
23 Dec 2021 14:27

EXECUTIVE CHANGES: PCF chair departs; Celtic CEO confirmed

EXECUTIVE CHANGES: PCF chair departs; Celtic CEO confirmed

Read more
23 Dec 2021 12:21

IN BRIEF: PCF's revenue rises but swings to loss on operating expenses

IN BRIEF: PCF's revenue rises but swings to loss on operating expenses

Read more

Login to your account

Don't have an account? Click here to register.

Quickpicks are a member only feature

Login to your account

Don't have an account? Click here to register.