Interim Results

 6 October 2016

Morses Club PLC

Interim results for the twenty-six weeks ended 27 August 2016

Morses Club PLC ("the Company" or "Morses Club"), the UK's second largest home collected credit ("HCC") lender, is pleased to announce its interim results for the twenty-six-week period ended 27 August 2016.

Highlights

· Strong first half performance with revenue up 8% to £47.2m (H1 FY16: £43.6m)

· Net loan book growth of 5% from last year to £56.2m (H1 FY16: £53.6m)

· Impairments as a percentage of revenue for the period was 22.5% (H1 FY16: 18.3%), remaining at the lower end of our target range and reflecting our policy to focus on higher quality lending

· 2.1% increase in customer numbers to over 207,000 (H1 FY16: 203,000)

· Completed three acquisitions with total gross receivables of £3.3m

· Strong territory builds momentum with 114 active territory builds (H1 FY16: 68) with positive contribution further illustrating emphasis on high quality lending

· Over 5,000 Morses Club Cards issued, exceeding our target for the year within the first six months of launch

· Adjusted1 profit before tax slightly down at £8.6m (H1 FY16: £8.8m); reported profit before tax £4.6m (H1 FY16: £6.4m)

· Adjusted1 EPS - 5.3p (H1 FY16: 5.4p); Basic EPS 2.7p (H1 FY16: 3.7p)

· Maiden PLC interim dividend declared of £2.7m equating to 2.1p per share (H1 FY16: nil)

Key performance indicators

1 Adjusted profit before tax and Adjusted EPS are explained on P7

2 Defined as earnings before exceptional items as a percentage of tangible asset value calculated on a last 12 months basis

3 Defined as earnings before exceptional items as a percentage of tangible equity value on a last 12 months basis

4 Calculated on a last 12 month basis

5 Tangible equity and asset value excludes £2.7m of capitalised IT costs which are classified as intangibles on the balance sheet

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

"Our strong first half performance demonstrates the success of our credit policy and emphasis on high quality lending, as well as the positive contribution of recent territory builds and the continuation of our successful acquisition policy. We have made significant progress with both our strategic plan of using technology to maximise the customer experience and implementing our growth initiatives, such as the Morses Club Card which we launched in April.

Customer demand for the Morses Club Card exceeded our expectations for the full year within its first 6 months and its success gives us confidence that we can continue to build on our core home collected credit customer service ethos to target a broader non-standard credit customer base, offering consumers products in increasingly flexible ways. We remain confident in the outlook for the full year."

Forward looking statements

This announcement includes statements that are, or may be deemed to be, "forward-looking statements". By their nature, forward-looking statements involve known and unknown risks and uncertainties since they relate to future events and circumstances. Actual results may, and often do, differ materially from any forward-looking statements.

Any forward-looking statements in this announcement reflect Morses Club's view with respect to future events as at the date of this announcement. Save as required by law or by the AIM Rules for Companies, Morses Club undertakes no obligation to publicly revise any forward-looking statements in this announcement following any change in its expectations or to reflect events or circumstances after the date of this announcement.

For further information please contact:

Analyst presentation

There will be an analyst presentation to discuss the results at 9.30 a.m. today at Numis Securities Ltd, 10 Paternoster Square, London, EC4M 7LT.

Those analysts wishing to attend are asked to contact Ed Gascoigne-Pees at Camarco on +44 (0) 20 3757 4984 or [email protected].

Notes to Editors

About Morses Club

Morses Club is the second largest UK Home Collected Credit lender with over 200,000 customers and approximately 1,800 agents across 100 locations throughout the UK.

The Company provides a range of loan products through a combination of traditional and online marketing channels. A significant majority of the Company's borrowers are repeat customers and the Company enjoys consistently high customer satisfaction scores, of at least 95 per cent.

Morses Club traces its history back over 130 years and entered the UK HCC market in 1997. The Company acquired Shopacheck Financial Services in 2015.

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 12 million consumers.

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 2009, unsecured personal lending has grown from £161 billion to £244 billion in 2015.

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 via self-employed agents 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 3 million people using the services of UK HCC lenders, of which between 1.5 million and 2 million people borrow regularly.

Chief Executive's Statement

This is our maiden set of interim results as an AIM quoted company, following our successful IPO in May 2016. The first half of this year has seen steady progress with revenue increasing by 8% to £47.2m (H1 FY16: £43.6m). We are also pleased to announce our first interim dividend of 2.1p per share.

Demand for our products in the HCC sector has remained strong despite the uncertainties created by Brexit and our business is ideally positioned to deliver strong performance and cash generation throughout the economic cycle. We achieved a 16.9% increase in total credit issued to £66.0m (H1 FY16: £56.4m) through a combination of acquisitions, new territory builds and core business stability.

Margins in H1 FY16 were particularly strong, as a result of our focus on integrating Morses Club and Shopacheck Financial Services, which meant that less new business (typically higher risk and higher impairment rate) was written during that period. During H1 FY17 we have restructured our agent packages to attract and retain the best agents with a consequential increase in overall agent commission cost. As a result, our adjusted profit before tax for H1 FY17 was slightly lower than last year at £8.6m (H1 FY16: £8.8m).

Territory builds typically generate high quality business, with new agents introducing high quality customers to the Company. Whilst the Company pays new agents that join from a competitor a subsidy in the first year to maintain their level of income, this investment places us in a strong market position and we expect to benefit in H2 and beyond.

HCC remains at the heart of our business and the agent/customer relationship is one of the core drivers of recurring revenue. Our customer feedback shows that we are delivering customer satisfaction of above 95%, underlining the importance of retaining the highest quality agents. This, coupled with the positive financial contribution of a higher quality customer base and our ability to target new customers with the introduction of new digital products, is expected to help to strengthen our position in the market.

As expected, total impairment charges during the period increased, although our impairment / revenue ratio was 22.5% for the period, at the lower end of our target range (H1 FY16: 18.3%).

Our customer numbers increased by 2.1% to approximately 207,000 (H1 FY16: 203,000) primarily driven by acquisitions and territory builds. Our focus on higher quality lending has resulted in a 6% increase in gross loan balances being attributable to our highest quality customers. Over the last 26 weeks there has been a reduction in average loan duration to 42.0 weeks, a decrease of 5%. Cash and revenue yields continue to increase. We have also seen increased demand for our 20-week product which will continue to reduce average loan duration over time.

We have made solid progress on our strategic growth initiatives which are centred around using technology to improve our customer offerings and provide products such as cashless lending, to ensure customers can access credit with the flexibility they require. We believe this is particularly important as customers' spending habits become increasingly digitally focused.

Strategic Growth Initiatives

Territory Builds and Acquisitions

Our strategy for growth is based on achieving both organic and inorganic growth. Our organic growth is focused on our strategic growth initiatives and territory builds and inorganic growth is targeted on loan book acquisitions.

Territory builds tend to be a source of high quality loan books and repeat customers and a low cost means of customer acquisition. At 27 August 2016, we had 114 active territory builds compared to 68 at the same date in 2015, demonstrating our significant investment. Territory builds continue to perform broadly in line with our impairment/revenue ratio, demonstrating the quality of this growth.

We believe that the increasingly robust regulatory landscape will provide a compelling opportunity for market consolidation. There are currently over 400 owner operators in the sector, a number of whom may not be able to meet regulatory requirements and could look to exit the market. During the period we completed three acquisitions, with total gross receivables of £3.3m acquired. These acquisitions added 79 agents and approximately 10,500 customers to our business. The total gross receivables acquired in the first half was marginally lower than expected, but we are focused on only acquiring loan books that will be accretive to our existing business.

Since the end of the trading period we have completed a further 2 acquisitions, with total gross receivables of £3.2m, adding 74 agents and approximately 8,000 customers to our business. The Company has a short term acquisition pipeline of approximately £1.6m of gross receivables and we are currently exploring a number of other potential acquisitions for the second half of our financial year. With a number of our acquisitions having taken place at the end of H1 or shortly after, we are well-placed to see the positive effect in H2.

The acquisitions have been bolstered by a strong performance with territory builds, higher levels of organic growth and an increase in applications from new customers via our website.

New Product Development

We have ambitious plans to introduce a number of new products to keep Morses Club at the forefront of the HCC sector and wider non-standard consumer finance sector in general. This will align us more closely with the way our customers increasingly utilise digital products, as reflected in our agent feedback and monthly independent customer surveys.

The significant investment we have made in our technology platform has enabled us to develop our digital offering for customers. In April 2016 we introduced a new cashless lending service, the Morses Club Card, giving our customers increased flexibility in the way they borrow from us and enabling our customers to buy on-line, as well as on the high street. We set ourselves a target of issuing 5,000 cards in 2016/2017 and exceeded this within the first half of the year, demonstrating the significant demand for this product amongst our customers.

We have made significant progress on the development of our online lending product, which we expect to launch in Q4 2016, subject to FCA approval. We have seen a 30% increase in visitors to our website to 113,000 per month, 75% of whom, our data suggests, are looking for alternatives to our core HCC offering. We continue to develop our pipeline of products to address this demand, which external research suggests is in the region of an additional 9 million people who are accessing the UK non-standard credit market.

Mobility - Phase II

In addition to the Morses Club Card, the Company is investing £0.5m during the year in the second stage of our mobile technology solution. This has been rolled out during the period and is expected to further streamline the process for providing loans to customers and our credit approval process.

Enhanced marketing

The Company's website continues to receive an increasing number of visitors (30% increase year-on-year) and during the period web and affiliate referrals generated 20,000 new customers. Mobile represents c.82% of all traffic on the website, reinforcing the Directors' opinion that this is a key route to market.

Dividend

The Board expects that strong cash flows generated by the Company's businesses will support a progressive dividend policy whilst at the same time underpinning sustainable growth in its loan book. Accordingly, the Board is delighted to declare a maiden PLC interim dividend of 2.1p per share (H1 FY16: nil).

The dividend of 2.1p per share will be paid on 18th November 2016 to ordinary shareholders on the register on 21st October 2016.

Outlook

In the first half of this financial year Morses Club has invested significantly, laying the foundations for future growth. Contributions from territory builds and improvements in the quality of the core customer base have driven the increases in revenue and total credit issued. The Directors expect market activity to increase in the forthcoming period, and the Company's aim is to grow its market share via its focus on more territory builds, acquisitions and increased lending. In addition, the second half of the financial year should benefit from the maturing of territory builds started in the first half, and the integration of the recent acquisitions.

The Company continues to make good progress on its growth strategy of broadening its reach and potential customer base through the development of our digital platform to provide additional services and products for our existing and new customers, accessing different markets. The early success of the Morses Club Card gives the Company confidence that there is significant demand for new products. Trading is in line with the Directors' expectations and we remain confident in the outlook for the full year.

Paul SmithChief Executive Officer

Date: 6 October 2016

Financial Review

1 Amortisation of customer lists and agent networks and impairment of goodwill

2 Financing costs in the comparative periods were paid by the parent company, Perpignon Limited, and this charge represents the amounts that would have been payable by the company had the parent company not paid them

3 Adjusted profit before tax and adjusted EPS figures have been presented within the interim report as the directors believe they are more representative of the underlying operations of the business

4 Costs incurred in relation to the company's IPO and AIM listing

5 Adjusted EPS reflects adjusted profit after tax divided by weighted average number of shares (note 6)

Revenue for the twenty-six-week period ended 27 August 2016 increased by 8% to £47.2m (H1 FY16: £43.6m). This was driven by a 16.9% increase in total credit issued to £66.0m (H1 FY16: £56.4m), which reflects a 2.1% increase in customer numbers to 207,000 and an increasing proportion of quality lending to our highest tier customers.

Agent commission was up from £9.2m to £10.9m, an 18.5% rise, which includes £0.7m (H1 FY16: £0.3m) of first year subsidies in relation to territory builds, as a result of the significant increase in activity. The remaining increase is due to increased cash collected and our continued investment in developing a high quality agent network to deliver the best customer experience.

The total impairment charge increased to £10.6m; however the impairment/revenue ratio was 22.5% for the period (H1 FY16: 18.3%), comfortably within our target range of 22.0% to 27.0%. In the period we saw a 6% increase in the proportion of highest tier customer balances in our gross loan book.

Gross profit was down 2.7% from £26.4m to £25.7m for the period. This slight decrease is partly a result of the increased spend on agent commission, although we expect this investment to improve agent retention and benefit customer experience, contributing to the future growth of the business.

Total costs (excluding exceptional costs, amortisation of intangibles and impairment of goodwill) as a percentage of revenue decreased to 57.6% from 58.9%. Within this, administration expenses (excluding non-operating costs) decreased to £15.7m from £16.1m, a reduction from 36.9% to 33.3% of revenue, an efficiency gain of 9.8%.

Exceptional costs were £2.1m for the period, due to the costs of the IPO (H1 FY16: nil).

Regulatory Update

In April 2014, regulatory responsibility for the UK HCC sector was transferred from the Office of Fair Trading to the Financial Conduct Authority. The Company continues to operate under its interim permission whilst its application for full authorisation is being reviewed.

The Directors believe that the Company complies with all material relevant legislation, secondary legislation, regulation and practice applicable to UK HCC lenders. As such, we expect to receive full authorisation in due course, alongside other major UK HCC lenders.

Funding

From March 2016 the Company has had access to a £25 million revolving asset based credit facility with Shawbrook Bank Limited, which provides sufficient headroom to manage the business and meet our strategic objectives for the foreseeable future. This facility contains the usual terms and conditions for a facility of this type.

As at 27 August 2016, the Company had drawn £8.5 million of this facility. The Directors expect this to increase during the second half of the year in the run-up to Christmas.

Principal Risks and Uncertainties

There are a number of potential risks and uncertainties which could have a material impact on the Company's performance over the remaining 26 weeks of the financial year and could cause results to differ materially from expected and historical results. The Directors do not consider that the principal risks and uncertainties have changed since the publication of the annual report for the year ended 27 February 2016. These should be read in the context of the cautionary statement regarding forward looking statements at the beginning of these Interim Results. Specifically, the Board does not consider the recent vote in the UK to exit the European Union will materially impact the Company's underlying business and as such will not necessitate any change to the Company's identified risks. A detailed explanation of the risks summarised below, and how the Company seeks to mitigate the risks, can be found on page 5 of the annual report which can be found at www.morsesclubplc.com/investors/.

The Company's principal financial assets are loan book receivables, cash and other receivables.

Liquidity Risk

The Directors monitor liquidity closely. From March 2016 the Company has access to a £25m revolving asset based credit facility (H1 FY16: nil), (February 2016: £20m), which provides sufficient headroom to manage the business and meet its strategic objectives. The Company does not use any complex financial instruments.

Credit Risk

The Company is involved in the provision of consumer credit and a key risk for the Company is the credit risk inherent in amounts receivable from customers which is principally controlled through credit control policies supported by regular impairment reviews. The amounts presented in the balance sheet are net of provisions for impairments.

Operational Risk

The Directors are confident that they have mitigated operational risk through an embedded control environment with the use of integrated technology and in-depth Management Information reporting data. The Company has a strong compliance culture, with robust systems and controls and provides regular regulatory training to all employees and agents.

Regulation

The Company is also subject to legislative regulatory changes within the consumer credit sector and stays in touch with changes through its compliance and credit risk functions and through the Consumer Credit Association and through regular dialogue with the FCA.

Interim Results for the 26-week period ended 27 August 2016

Related Party Transactions

Related party transactions are disclosed in note 13 of these financial statements.

By order of the board:

Andy ThomsonChief Financial Officer

Date: 6 October 2016

Registered Office:Kingston HouseCentre 27 Business ParkWoodhead RoadBirstallBatleyWest YorkshireWF17 9TD

Independent Review Report to Morses Club PLC

We have been engaged by the Company to review the condensed set of financial statements in the half-yearly financial report for the 26 weeks ended 27 August 2016 which comprises the consolidated income statement, the consolidated balance sheet, the consolidated statement of changes in equity, the consolidated cash flow statement, notes to the consolidated cash flow statement and related notes 1 to 13. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

This report is made solely to the Company in accordance with International Standard on Review Engagements (UK and Ireland) 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board. Our work has been undertaken so that we might state to the Company those matters we are required to state to it in an independent review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company, for our review work, for this report, or for the conclusions we have formed.

Directors' responsibilities

The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the AIM Rules of the London Stock Exchange.

As disclosed in note 1, the annual financial statements of the Group are prepared in accordance with IFRSs as adopted by the European Union. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting," as adopted by the European Union.

Our responsibility

Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.

Scope of review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the 26 weeks ended 27 August 2016 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the AIM Rules of the London Stock Exchange.

Deloitte LLP

Chartered Accountants and Statutory Auditor

Birmingham, United Kingdom

Date: 6 October 2016

Condensed Consolidated Income StatementFor the 26-week period ended 27 August 2016

All results derive from continuing operations. A Statement of Comprehensive Income is not included as there is no other income or losses, other than those presented in the Income Statement.

Condensed Consolidated Balance SheetAs at 27 August 2016

Condensed Consolidated Statement of Changes in EquityFor the 26-week period ended 27 August 2016

Condensed Consolidated Cash Flow StatementFor the 26-week period ended 27 August 2016

Notes to the Consolidated Cash Flow StatementFor the 26-week period ended 27 August 2016

1 Reconciliation of profit before taxation to net cash inflow from operating activities

2 Analysis of cash flows for headings netted in the cash flow statement

Notes to the Consolidated Financial StatementsFor the 26-week period ended 27 August 2016

1. ACCOUNTING POLICIES

General information

The Company is a public limited company incorporated and domiciled in the UK. The address of its registered office is Kingston House, Centre 27 Business Park, Woodhead Road, Birstall, Batley, West Yorkshire, WF17 9TD.

The information for the year ended 27 February 2016 does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. A copy of the statutory accounts for that year has been delivered to the Registrar of Companies. The report of the auditors on those financial statements was unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under section 498(2) or (3) of the Companies Act 2006.

The unaudited condensed interim financial statements for the 26 weeks ended 27 August 2016 have been reviewed, not audited, and were approved by the Board of Directors on 5 October 2016.

Going concern

The directors are satisfied that the Group has sufficient resources to continue in operation for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the condensed financial statements.

Accounting convention

The statutory annual financial statements of Morses Club PLC are prepared under International Financial Reporting Standards (IFRS) adopted by the European Union. The condensed set of financial statements included in this half yearly financial report has been prepared in accordance with International Accounting Standard 34 'Interim Financial Reporting', as adopted by the European Union.

Accounting policies

The accounting policies applied in preparing the unaudited condensed interim financial statements are consistent with those used in preparing the statutory financial statements for the year ended 27 February 2016.

New and amended standards and interpretations need to be adopted in the first interim financial statements issued after their effective date (or date of early adoption). There are no new IFRSs or International Financial Reporting Interpretations (IFRIC) that are effective for the first time for the 26 weeks ended 27 August 2016 which have a material impact on the Group.

2. SEASONALITY

The Group's peak period of lending to customers is in the run-up to Christmas in the second half of the financial year. Typically, approximately 51% of the loans issued are made in the second half of the financial year and the peak lending and collections period leads the Group to operate with a materially higher draw down on debt facilities in December. In addition, the Group's accounting policies relating to revenue and impairment are an important influence on the recognition of the Group's profit between the first and second halves of the financial year. The interest income earned on loans and receivables is spread on an effective yield basis over the contractual term of the Group's loans and receivables resulting in revenue being split broadly evenly between the first and second halves of the financial year, notwithstanding that the larger proportion of credit is issued in the second half of the financial year. The accounting policy relating to the impairment of customer receivables requires impairments to be recognised only when there is objective evidence of impairment of a customer balance, such as missed payments. This results in the group's largest impairment charges arising early in each financial year following the seasonal peak issue of loans in the lead-up to Christmas.

3. RESTRUCTURING COSTS

Following the acquisitions within both the current and prior periods (see note 12) and their subsequent integration within Morses Club PLC, £84,000 (H1 16 - £646,000) (YE 16 - £783,000) of restructuring costs were incurred. These have been included within administration expenses.

4. TAXATION

The tax charge for the period has been calculated by applying the directors' best estimate of the effective tax rate for the financial year of 23.87% (H1 16 - 24.41%) (YE 16 - 23.69%), to the profit before tax for the period. The reduction in tax rate reflects the change in UK corporation tax rate from 21% to 20% which was effective from 1 April 2015.

5. DIVIDENDS

The directors have declared an interim dividend in respect of the 26 weeks ended 27 August 2016 of 2.1p per share (H1 16 - £nil) (YE 16 - 37.5p) with a total half year dividend pay-out of approximately £2.7m (H1 16 - £nil) (YE 16 - £48.6m). This dividend is not reflected in the balance sheet as it was declared after the balance sheet date.

6. EARNINGS PER SHARE

Diluted earnings per share calculated the effect on earnings per share assuming conversion of all dilutive potential ordinary shares. Dilutive potential ordinary shares are calculated for awards outstanding under performance related share incentive schemes such as the Deferred Share Bonus Scheme. The number of dilutive potential ordinary shares is calculated based on the number of shares which would be issuable if the performance targets have been met.

On 25 February 2016 the Company cancelled 72,705,000 shares and divided the remaining into 129,500,000 1p shares. This transaction changed the number of ordinary shares outstanding without a corresponding change in total equity. The Earnings per Share calculations have been adjusted retrospectively in accordance with IAS 33 (26), increasing the weighted average number of shares by 55,500,000.

7. OTHER INTANGIBLE ASSETS

8. TRADE AND OTHER RECEIVABLES

Amounts receivable from customers

9. BANK AND OTHER BORROWINGS

Additional loans of £500,000 were drawn down under the Group's existing loan facility to partly fund the acquisitions during the period (note 12).

Repayments of loans amounting to £1,000,000 were made during the period, in line with repayment terms.

10. RESERVES

Details of the movements in reserves are set out in the statement of changes in equity. Share capital as at 27 August 2016 amounted to £1,295,000.

11. FINANCIAL INSTRUMENTS

The directors consider that the carrying value of financial assets and financial liabilities recorded at amortised cost in the financial statements are approximately equal to their fair values.

12. ACQUISITIONS

Deebank Financial Services Limited

On 18 April 2016 the Company acquired the loan book and certain assets of Deebank Financial Services Limited via a cash purchase. The costs incurred in relation to this acquisition of £13,000 were expensed to the Income Statement.

Universal Trading Company Limited

On 20 July 2016 the Company acquired the loan book and certain assets of Universal Trading Company Limited via a cash purchase. The costs incurred in relation to this acquisition of £12,000 were expensed to the Income Statement.

H. Stanley (Hull) Limited

On 10 August 2016 the Company acquired the loan book and certain assets of H. Stanley (Hull) Limited via a cash purchase. The costs incurred in relation to this acquisition of £1,000 were expensed to the Income Statement.

KDS Finance

On 26 March 2015 the Company acquired the loan book and certain assets of KDS Finance via a cash purchase. The costs incurred in relation to this acquisition of £171,000 were expensed to the Income Statement.

Sunniside Finance

On 17 June 2015 the Company acquired the loan book and certain assets of Sunniside Finance via a cash purchase. The costs incurred in relation to this acquisition of £12,000 were expensed to the Income Statement.

Lagans Finance

On 25 September 2015 the Company acquired the loan book and certain assets of Lagans Finance via a cash purchase. The costs incurred in relation to this acquisition of £17,000 were expensed to the Income Statement.

Subsequent to the half year the Group acquired the trade and assets of Pearlmans Finance Limited and Portwood Finance Company Limited during September 2016. Aggregate consideration is expected to be £2.6m. As the acquisitions took place just prior to the reporting date, the Group has not yet completed its fair value assessments. Full disclosures will be provided in the 2017 Annual Report.

13. RELATED PARTY TRANSACTIONS

Perpignon Limited was the parent of Morses Club PLC prior to the IPO and Shopacheck Financial Services Limited is a subsidiary of Morses Club PLC.

The Company undertook the following transactions with Perpignon Limited and Shopacheck Financial Services Limited during the period: