Trading update and notice of preliminary results

 28 February 2019

Morses Club PLC

Trading update and notice of preliminary results

Morses Club PLC ("the Company"), the UK's second largest home collected credit lender, provides the following trading update for the 52-week period to 23 February 2019.

Trading performance for the period has been strong and is in line with the Board's expectations. Total credit issued increased 2.4% to £178.5m compared with the prior year (FY 2018: £174.4m) and the Company's gross loan book has grown by over 7% compared with 24 February 2018 (5% increase in the core book and 2% as a result of the acquisitions of the Eccles Savings & Loans Limited and Hays Credit LLP assets).

Total customer numbers increased by 2.6% to 235,000 as at 23 February 2019 (FY 2018: 229,000).

The positive momentum surrounding the growth of the Morses Club Card continues. Our first cashless lending product now has 30,000 customers with £15.5m of loan balances on cards (FY 2018: 21,000 customers and £10.6m of loan balances).

On 26 February 2019, Morses Club announced the acquisition of the business and certain assets of CURO Transatlantic limited ("CURO TA"), an online lending business. This acquisition represents a major milestone in the Company's product diversification strategy, as we develop digital products to meet the changing needs of our customers and broaden our customer base. The acquisition of CURO TA complements those made in our core HCC market, as we continue on our path of sustainable growth.

Paul Smith, Chief Executive Officer of Morses Club, said:

"We are delighted by the strong performance we have delivered this year, achieving consistent growth both organically and through acquisitions. The significant consolidation we are seeing across the HCC sector is continuing and the fragmented marketplace has enabled us to make high quality acquisitions, expanding our regional presence.

"The quality of our service and products, which are designed around the needs of our customers, remains paramount as we develop our digital platform and increase our online offering in line with our product diversification strategy. We are particularly excited about the acquisition of the CURO TA assets and the contribution they will make to our digital offering.

"We are confident in our outlook for the coming year, which we expect to be reflected in an increased FY2019 dividend payment for shareholders. We continue to pursue opportunities for growth in both our core HCC market and across the wider non-standard finance sector."

Notice of Preliminary Results

Morses Club will be announcing its preliminary results for the 52-week period ended 23 February 2019 on 2 May 2019. There will be an analyst presentation to discuss the results at 9:30am at Panmure Gordon, 1 New Change, London, EC4M 9AF. Those analysts wishing to attend are asked to contact Jake Thomas at Camarco on +44 (0)20 3781 8337 or at jake.thomas@camarco.co.uk.

This announcement constitutes inside information for the purposes of article 7 of the Market Abuse Regulation (EU) No 596/2014.

For further information

Notes to Editors

About Morses Club

Morses Club is the second largest UK Home Collected Credit (HCC) lender with 230,000 customers and 1,900 agents across 94 locations throughout the UK.

The Company offers a range of loan products to its customers through its extensive self-employed agent network. The majority of the Company's borrowers are repeat customers and the Company enjoys consistently high customer satisfaction with scores of 95% or above1.

The Company is using technology to broaden its offering and provide new products to ensure customers can access credit with the flexibility they require. In April 2016, its cashless lending product, the Morses Club Card, was introduced, enabling its customers to buy online as well as on the high street. Dot Dot Loans, the Company's first online instalment product, was launched in March 2017.

Morses Club successfully listed on AIM in May 2016. 

About the UK non-standard credit market

The UK non-standard credit market, of which UK HCC is a subset, consists of both secured and unsecured lending and is estimated to comprise around 10 million consumers2.

Non-standard credit is the provision of secured and unsecured credit to consumers other than through mainstream lenders. Lenders providing non-standard credit principally lend on an unsecured basis and the market is characterised by high frequency borrowing.

Since February 2014, unsecured personal lending has grown from £161 billion to £209 billion in February 20183.

1 Independent Customer Satisfaction Survey conducted by Mustard2 FCA High Cost Credit Review Technical Annex 1: CRA data analysis of UK personal debt - July 20173 Source: Table J Bank of England Money & Credit Report February 2018

About UK Home Collected Credit

UK HCC is considered to be a specialised segment of the broader UK non-standard credit market. UK HCC loans are typically small, unsecured cash loans delivered directly to customers' homes. Repayments are collected in person during weekly follow-up visits to customers' homes.

UK HCC is considered to be stable and well-established, with approximately 1.6 million2 people using the services of UK HCC lenders.

2 High Cost Credit Review ANNEX 1 - July 2017