reports
- Liberum Research Team
- Liberum Research Team
- James Allen
- Nick Anderson
LIBERUM: Sancus Lending Group Limited* - Pivot to profitability in FY ...
FY 22 results show strong loan growth in both the UK and Ireland offset by weakness at Offshore, which has been restructured. While the closure of Gibraltar in Offshore was disappointing, we believe there are lots of reasons to be positive at Sancus after two years of write-downs. We update our estimates and now expect 50% growth in the loan book to £250m by the end of FY 23 and a pivot to profitability in FY 24. While the re-fi increased funding capacity, management is exploring other ways to a...
Update: Simplification advancing
GLI Finance (GLI) is delivering on the simplification promised by its strategic review. It has completed the acquisition of interests in Sancus Gibraltar and BMS Holdings to create Sancus BMS Group, which will be joined in the new niche alternative lending segment by the UK invoice and supply chain financier, Platform Black (to be renamed Sancus Finance). Two other segments comprise the asset management company and the fintech investments GLI has prioritised or is evaluating. Among the latter, i...
Outlook: Transformation under way
GLI Finance (GLI) has new management, a new strategic investor and is undergoing a strategic review designed to maximise shareholder value from its investments in 19 alternative finance platforms. It has effectively become an operating company rather than an investment company, which should give it greater control of its assets, and its destiny. The shares offer a high yield of 7.8%. This is not covered by current earnings or operational cash flow but can be paid from cash, selling assets or inc...
Update: Strategic investment
GLI Finance (GLI) has altered its proposed measures to strengthen its balance sheet following investor feedback on its original proposals. It has accepted a capital and cash injection from a strategic investor, Somerston Group, and it intends to work closely with the company in the future. GLI will undertake a strategic review of its alternative finance platforms and focus its resources on those it believes will generate incremental shareholder value; this may result in write-downs. The dividend...
Update: Balance sheet strengthening
As expected, GLI Finance (GLI) has announced measures to improve its balance sheet and help it to continue paying a 5p per share annual ordinary dividend and possibly provide additional funds to grow its loan book. GLI will seek shareholder approval to issue £20-40m of new zero dividend preference shares maturing in 2020 (2020 ZDP shares) and a potential issue of convertible unsecured bonds (CULS) to replace an existing loan facility. The EGM will take place on 21 December 2015 and the listing ...
Outlook: Alternative finance company
GLI Finance (GLI) has successfully altered its investment strategy to participate in the fast-evolving and expanding alternative finance market through investing in alternative finance platforms, alternative finance loans and the creation of an asset management company. Loan growth at its platform investments is accelerating and management expects most to be profitable within a year. GLI aims to continue paying the generous dividend it paid as a CLO investor. It offers investors a 10% yield with...
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