(Alliance News) - Small business lender Funding Circle Holdings PLC outperformed its earnings and profit guidance in the first half as its loans under management hit record levels.
Shares in Funding Circle were trading up 7.2% at 149.60 pence each in London on Thursday morning.
"This has been another strong period of progress and growth within the business...We have exceeded our previous guidance and delivered GBP53.3 million of [adjusted earnings before interest, tax, depreciation and amortisation] and GBP35.5 million of operating profit in the first half of 2021," said current chief executive of Funding Circle, Samir Desai.
Total income hit GBP120.6 million in the six months ended June 30, up 19% from GBP101.2 million a year ago. Income was 48% above the same period in 2019, when the company reported total revenue of GBP81.7 million.
Funding Circle swung to a pretax profit of GBP35.4 million from losses of GBP115.1 million and GBP30.8 million in the first halves of 2020 and 2019 respectively.
Including fair value gains of GBP8.1 million, net income surged to GBP128.7 million from GBP5.1 million. Last year, the company's net income took a GBP96.1 million hit.
The company said its loans under management hit a record GBP4.93 billion in the first half, up by a third from GBP3.72 billion a year earlier.
"We are seeing an acceleration in the shift towards online in small business lending as a result of Covid and this has opened up an enlarged opportunity for Funding Circle and we are well placed to capture this going forward," Desai added.
Also on Thursday, Funding Circle announced that its managing director, Lisa Jacobs, will take over the role of CEO from Desai at the start of 2022.
At that point, Desai will transition to a new role as non-executive director, the company said.
Jacobs joined the company as chief strategy officer in September 2012. She previously worked as a financial services consultant at the Boston Consulting Group, the company noted.
Jacobs said: "Since launching, [Funding Circle has] helped more than 120,000 businesses access GBP13 billion...We have achieved a great deal as a company so far, but the best is yet to come. Our machine learning and technology platform is transforming the small business borrowing experience and our new payment products, like FlexiPay, represent the next step in our mission to solve more funding problems for small businesses."
By Scarlett Butler; scarlettbutler@alliancenews.com
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Funding Circle (FCH)