UK-based independent lender Private &
Commercial Finance Group (PCFG) recorded an increase in funding and
pre-tax profit at the same time as a loss in turnover for the
six-month period ended 30 September 2011.
Profit before tax stood at £241,901 for the
period, a 61% improvement from the £150,302 recorded for the
equivalent time in 2010. The average return on portfolio assets
increased to 0.5%, and total net assets grew by 12% to £8.2m.
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Turnover for the period was £26.9m, a fall
from the £29.4m recorded for the same period a year prior, and new
business advances fell by £2.6m to £19.7m for the period.
However, PCFG attracted £10 million of new
medium-term funding facilities, and increased its existing
facilities by £5 million. In August, Bermuda Commercial Bank (BCB)
acquired an 8.8% stake in the company.
Scott Maybury, PCFG’s chief executive, said:
“We have achieved credible results in the period despite an
economic and banking environment that continues to be challenging.
I am very pleased to report that in addition to the new funding
facility of £7 million secured in June, we have recently arranged
another new facility of £3 million and received small increases to
two of our existing facilities.
“This increase in funding facilities, together
with the acquisition of £6 million of receivables, has provided a
boost to our income and provided some positive impetus after a
sustained period of portfolio run-off. We look forward to building
on these achievements.”
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By GlobalDataChairman David Anthony said: “We recognise the
need for further improvement in profit before tax and now intend to
make a fresh start. Our medium-term objective is to improve the
return on average portfolio assets to 2% from its present level of
0.5% (2010 – 0.3%). We will do this by finding new routes to
market, improving margins, driving down operating and bad debt
costs and growing the portfolio.”
Anthony admitted organic growth of their
portfolio has been challenging, due to consumers deferring
investment decisions.
“New business originations fell by £2.6
million during the period, since we will not sacrifice quality or
forego margin for short-term gain.
“Our IT infrastructure and long-standing
relationships with introducers stand us in good stead and, while
there are signs, particularly in the business finance sector, of
the return of competitive pricing pressures, there is still
adequate opportunity for an independent finance company to
differentiate itself.”
georgina.lavers@vrlfinancialnews.com
