17 Nov 2015
GLI Finance Limited
Trading and financial
update
The Board is pleased to provide the
following trading and financial update having completed the
repositioning of its activities, which are now focussed on four
complementary areas:
·
Alternative lending Platforms (whether wholly
owned or as a significant shareholder) in several
countries
·
Direct lending, mainly through the
Platforms
·
Fund management with the first fund (GLI
Alternative Finance PLC "GLI Alt Fi") listed in September
2015
·
Investment in GLI's managed fund
GLI was an early mover in the
Peer-to-Peer (P2P) lending sector and has assembled a portfolio of
Platforms that provide lending diversity by duration, geography and
asset type and use highly differentiated origination
strategies. The rapid growth in the sector (Liberum AltFi
index for business P2P lenders for the 12 months to 11 Nov 2015 is
up 128.11% in UK, and 153.45% in Continental Europe - YTD £1.12bn)
is an international phenomenon and GLI, with Platforms in the UK,
Continental Europe, USA and Africa, continues to assess
opportunities throughout the world.
Direct lending activity
GLI's direct lending activity is
complementary to its investment in the Platforms enhancing their
ability to attract borrowers and providing loan origination
channels for GLI which generated interest at an average rate of
around 10% on its portfolio during the nine months ended 30
September 2015. Loan losses/provisions were approximately
0.7% of the closing loan book during the nine months ended
September 2015.
Managed funds
GLI's wholly owned subsidiary GLI
Asset Management Ltd is an authorised fund manager and intends to
launch a range of investment funds with differing strategies.
GLI's strategic aim of increasing the size and number of its
managed funds changes its risk profile as it generates fee income
from the managed portfolios with decreasing direct exposure to loan
losses.
Its first fund, "GLI Alt Fi" is a
London listed investment trust was launched in September
2015. GLI Alt Fi has acquired £40.2m direct loans from GLI
resulting in GLI holding 76% of GLI Alt Fi's issued share
capital. The target dividend yield on GLI Alt Fi's shares is
8% per annum.
It is intended that GLI Alt Fi,
which has already raised £12.5m from third party investors, will
continue to issue new shares enabling it to expand and diversify
its portfolio, reducing GLI's percentage shareholding. GLI
receives management fee income of 0.75% per annum of GLI Alt Fi's
net asset value (or of market capitalisation, if lower) of up to
£100m, and 0.5% of any excess.
Financial update
The Company intends to publish its
Net Asset Value formally, incorporating the results of a review of
the value of its investments in Platforms, by mid December.
Reflecting, in particular the launch of GLI Alt Fi, the segmental
analysis of GLI's statement of financial position has changed
significantly since 30 June 2015.
Unaudited management accounts as at
30 September 2015 indicate as follows:
|
30 Sept 2015
£'million
|
30 June
2015
£'million
|
Loan portfolio GLI family of
Platforms
|
48.88
|
76.05
|
Loan Portfolio through third
parties
|
0.55
|
7.25
|
Platforms (loans and
investments)*
|
62.84
|
61.25
|
Investment in GLI Alt
Fi**
|
41.18
|
0
|
Cash
|
0.25
|
2.55
|
Debtors
|
2.89
|
4.40
|
Assets
|
156.59
|
151.50
|
|
|
|
Creditors and accruals
|
(0.98)
|
(0.95)
|
Borrowings
|
(22.99)
|
(16.50)
|
ZDP Shares
|
(21.84)
|
(21.52)
|
Net assets
|
110.78
|
112.53
|
|
|
|
* The investments in Platforms (some
of which are subsidiaries and others are associated companies) are
shown at cost less impairments unless a transaction or third party
valuation provides evidence of a higher value. However, as at
the date of this announcement, no fair value adjustments have been
made since 30 June 2015 (the date of GLI's interim financial
statements).
** The investment in "GLI Alt Fi",
an investment trust managed by GLI Asset Management Limited is
shown at GLI's share of its net assets. The GLI Alt Fi shares
held by GLI as at 30 September 2015 represented 76% of its issued
share capital and had a mid-market value of £41.2m. In
statutory accounts, GLI Alt Fi would be consolidated as a
subsidiary of GLI, rather than the investment in GLI Alt Fi being
shown as a separate asset.
The table below shows the lending
type of GLI's loan portfolio through its own family of platforms
and third parties as at 30 September 2015.
Direct Loans
|
|
|
£'million
|
Invoice Finance
|
3.57
|
Trade Finance
|
0.23
|
Bonds
|
0.10
|
Term Lending
|
|
44.98
|
Total through GLI
Platforms
|
|
48.88
|
Loans through third
parties
|
|
0.55
|
Total
|
|
49.43
|
|
|
|
|
|
|
|
|
|
|
A similar analysis of GLI
Alternative Finance plc's statement of financial position and
portfolio of loans through the GLI family of Platforms as at 30
September 2015 is set out below:
|
£'million
|
Loan portfolio GLI family of
Platforms
|
32.64
|
Loan Portfolio through third
parties
|
5.70
|
Platforms (loans and
investments)
|
0.53
|
Cash
|
13.54
|
Debtors
|
0.56
|
Other assets
|
0.03
|
Creditors and accruals
|
(0.52)
|
Net assets
|
52.48
|
Loan portfolio GLI Family of
Platforms
|
|
|
|
£'million
|
|
Invoice Finance
|
0.42
|
|
Bonds
|
0.50
|
|
Term Lending
|
31.72
|
|
|
|
|
|
Total: GLI Platforms
|
32.64
|
|
|
|
|
|
|
|
|
|
|
|
|
GLI is currently undertaking some
test marketing, which may or may not lead to the issue of further
securities to refinance certain existing borrowings as well as
providing additional working and growth capital.
For further information, please
contact:
GLI Finance Limited
Geoffrey Miller
+1 203 916 0003
+44 7408 830719
Panmure Gordon (Nominated Adviser and
Corporate Broker)
Dominic Morley / Tom
Salvesen
+44 (0)20 7886 2500
Peter Steel
+44 (0)113 357 1150
Camarco (PR Advisor)
Ed Gascoigne-Pees
+44 (0)203 757 4984
+44 (0)788 400 1949
Hazel Stevenson
+44 (0)203 757 4989
+44 (0)798 600 9720
About GLI Finance Limited
GLI Finance (www.glifinance.com) is a
specialist provider of finance to small and medium sized
enterprises. Its ordinary shares are quoted on AIM and its
issued zero dividend preference shares are listed and traded on the
main market of the London Stock Exchange (ticker GLIF). GLI Finance
both invests in loans to SMEs and originates finance for SMEs
through a variety of finance platforms.
The platforms in which GLI Finance
is invested vary by geography, industry, size of lending and by
type of lending. They include Global Trade Finance, UK and US SME
Lending, Offshore Lending, UK invoice discounting, European invoice
discounting, Global multi-asset crowd funding and UK
property-backed lending.