26th Mar 2015 11:56
LONDON (Alliance News) - GLI Finance Ltd Thursday said it swung to a net loss in 2014 as it reported lower revenue and higher operating expenses, after it acquired a range of platforms that turned it into a lender to small and medium sized businesses.
The group has been buying up platforms for lending to SMEs and sold its remaining collateralised loan obligation portfolio. It also bought Sancus in December 2014 for GBP37.8 million.
In a statement, the company said it made a net loss of GBP12.0 million in 2014, compared with a GBP890,380 net profit in the prior year. GLI is to pay a 5 pence per share dividend for 2014, flat on the prior year.
"GLI has now completed its transition to becoming a pure alternative finance provider through a range of platforms in which the company has a material stake. In addition, we have brought in-house an underwriting and origination capability for providing SME finance through our acquisition of Sancus Ltd," Chairman Patrick Firth said in a statement.
"We have continued to diversify our portfolio of platforms both geographically and by type of finance by adding ten new investments in the US, UK, Europe and sub-Saharan Africa. Our range of platforms in which we have strategic stakes give GLI a unique position in the alternative finance sector and one that we hope to exploit in years to come," Firth added.
Revenue, being interest income and money from dividends, fell to GBP6.2 million from GBP15.1 million. Net losses on financial assets and liabilities at fair value through profit or loss widened to GBP9.5 million from GBP6.8 million, partly offset by an increase in other income to GBP3.9 million from GBP1.5 million. Together, revenue and investment income, taking into account a swing to a GBP41,583 foreign exchange loss compared with a GBP399,541 gain in the prior year, fell to GBP584,368 from GBP10.2 million.
Operating expenses before finance costs rose to GBP11.3 million from GBP6.1 million, largely due to higher management fees, administration and secretarial fees, legal and professional fees, remuneration for the executive team and independent valuation fees. Other expenses, which include staff costs, fees to brokers and marketing among other costs, increased to GBP5.8 million from GBP2.7 million. Finance costs fell to GBP1.3 million from GBP2.3 million.
Re-analysing the company's income to "separate out the realised and unrealised gains and losses and gains and losses on currency transactions and show a like for like comparison of income earned", Chief Financial Officer Emma Stubbs said that GLI made a profit of GBP261,150 in 2014, compared with a GBP8.4 million profit in the prior year.
GLI shares were down 5.9% at 57.74 pence on Wednesday morning.
By Samuel Agini; [email protected]; @samuelagini
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