Vector Capital delivers ‘robust’ performance in FY20
In a trading update, (VCAP ) said it delivered a ‘robust performance’ for the year ended 31 December 2020 despite the impact of the ongoing COVID-19 pandemic.
The commercial lending group that offers secured loans primarily to UK businesses was admitted to trading on AIM last month, raising gross proceeds of £3.1 million at that time.
Vector said these net proceeds will be used to ‘further grow the Group's loan book and meet demand for short term loans which are typically used for general working capital purposes, bridging ahead of refinancing, land development and property acquisition.’
Today, the Company reported that trading for the period remains in line with market expectations following a strong trading performance, particularly during the months of April to June 2020, when the group said it had taken ‘prudent action’ in order to cease new loans.
After the Company recommenced the provision of new loans back in June 2020, it subsequently experienced strong demand with increased levels of new business origination.
As a result, the Group’s loan book, a key driver for revenue generation, grew to £36.4m as at 31 December 2020, an increase of 8.2% (FY19: £33.6m). It had 63 live loans at the year end with an average loan size of around £0.577m and an average loan to value of 44.2%.
Shares in Vector Capital have traded consistently since its flotation on AIM last month just below its initial price of 40p at 38.5p to open flat this morning following the announcement.
Subject to completion of the 2020 audit, the Company generated growth in revenue during the period with revenue expected to be around £4.3m, an increase of about 20% (FY19: £3.6m). As at 31 December 2020, Vector’s cash balances stood at £2.57m (FY19: £0.34m).
"We are pleased to report on the excellent performance of the Group, which has been delivered during a very challenging economic environment,” said CEO, Agam Jain.
He added, “Our resilient business model has enabled us to deliver on our strategy and it is pleasing to see strong demand for new loans and new business opportunities arising.
“Our recent fundraising, combined with existing bank facilities of £25m means we are well placed to build upon a robust foundation to scale the business and support future growth."
Vector expects to announce its results and declare its final dividend for the year ended 31 December 2020 in early April 2021.
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