Distrib. Fin. Regulatory News (DFCH)

11 July 2022

Distribution Finance Capital Holdings plc

("DF Capital", the "Company" or, together with its subsidiaries, the "Group")

First Half Trading Update

and

Notice of Interim Results

DF Capital, the specialist bank providing working capital solutions to dealers and manufacturers across the UK, today announces an update on trading for the six months ended 30 June 2022 ("H1 2022").

The Group has continued to make good progress against the objectives set at the start of the year and the Group continues to perform in line with the Board's expectations, despite the on-going wider economic uncertainty.

New loan origination during the period exceeded £439m, being materially up on H1 2021 (H1 2021: £295m) and H2 2021 (H2 2021: £395m) demonstrating the strength of relationships with dealers and manufacturers, as well as the scalability of the platform. The Group's loan book ended the period at c£308m, up c85% on the comparator period in the prior year (30 June 2021: £167m) and up 24% on the end of the last financial year (31 December 2021: £249m).

The Group has continued to increase its reach across its chosen markets and now supports 85 manufacturers (30 June 2021: 74 and 31 December 2021: 78) and over 900 dealers (30 June 2021: 706 and 31 December 2021: 805). Aggregate dealer loan facilities at the end of the period totalled c£724m, up 55% on the prior year (30 June 2021: c£467m) and up 20% on the end of the last financial year (31 December 2021: £601m).

The Group has a strong pipeline of new and existing facilities that underpin its growth ambitions, now exceeding in total £1.9bn, notwithstanding on-going near-term supply chain challenges across a number of sectors. The speed of product sales across a number of sectors remains consistent with prior periods, with average stock turn slowing marginally to 110 days (31 December 2021: c.105 days). Should dealer sales slow further through the balance of this year on the back of reduced consumer confidence and tightening of discretionary spend, the Group expects this to positively impact its loan book.

Carl D'Ammassa, Chief Executive of the Group, commented: "I am pleased with the progress we continue to make as a firm. Our performance during the first half of this year demonstrates the need for our lending products. Product diversification remains a strategic imperative for us and we continue to explore strategic opportunities in this area. The economic environment remains volatile and supply chains continue to be impacted. However, with over £700m of loan facilities now in place, utilisation levels expected to increase as we head towards the end of the year, and a strong capital base, I believe we have all the foundations in place to support our near-term growth ambitions."

Notice of Results

The Group's H1 2022 results are expected to be announced on 20 September 2022.

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