18th Jan 2021 09:29
(Alliance News) - Funding Circle Holdings PLC on Monday reported a strong performance for the second half of 2020, driven by record loans under management and originations.
For the six months to the end of December, the London-based peer-to-peer lender reported total income at GBP121 million, up 26% from GBP96 million the same period the year before.
This was driven by a 13% year-on-year rise in loans under management to GBP4.21 billion as at December 31 from GBP3.73 billion, while originations rose by 41% to GBP1.63 billion from GBP1.16 billion the prior year.
Geographically, income from the UK rose by 60% to GBP94 million, but income in the US dropped by 17% to GBP25 million, as borrower demand remained suppressed by uncertainty over whether there would be further Paycheck Protection Program lending.
However, additional PPP lending was approved by the US government in late December, and Funding Circle said it will start distributing loans in January.
As a result of the strong performance, Funding Circle expects adjusted earnings before interest, tax, deprecation and amortisation for the second half period to be no lower than GBP15 million.
For 2020 as a whole, the group posted total income of GBP222 million, a 25% increase from GBP177 million in 2019.
"As a result of Covid, we are seeing an acceleration in the shift towards online in small business lending. As the largest online SME loans platform we used our advanced technology to reach record levels of lending in 2020 and we are well placed to capture this enlarged opportunity going forward," said Chief Executive Officer Samir Desai.
"We achieved group Aebitda profitability in the second half of 2020. This is a significant milestone for the business and we expect to continue to be Aebitda profitable going forward," Desai added.
Funding Circle will publish its annual results on March 25.
Shares in Funding Circle were up 5.2% at 94.70 pence on Monday in London.
By Dayo Laniyan; [email protected]
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