GLI FINANCE swung to a net operating profit of £1.1m in the first half of the year, from a loss of £0.5m a year ago, driven by its Sancus BMS alternative lending division.
Sancus BMS, which comprises the peer-to-peer lenders Sancus Finance and Sancus Funding, increased its net operating profit by 193 per cent to £1.9m in the first half on the back of revenue growth of 42 per cent.
On a like-for-like basis, without additional revenue from a credit facility with Honeycomb Investment Trust, revenue grew by 28 per cent.
Sancus Finance, however, performed below the group’s targets. £2.1m has been written off following the two lenders’ integration into one Sancus UK business.
Sancus Finance is expected to break even by the end of 2018, by which time it will have started property-backed lending.
“Whilst Sancus Finance’s loan book has grown materially since last year, it has fallen short of where we had hoped it would be at this time,” said Andy Whelan, chief executive officer of GLI Finance.
The group made an overall loss of £9.3m, down from £15m a year ago, largely due to a further £8.3m writedown its in FinTech Ventures business.
“Whilst fintech as a sector continues to grow strongly, increased competition is making it increasingly difficult for smaller players, particularly those that are loss making, to raise further equity,” said Whelan. “Given the plethora of investment opportunities, investors are often able to negotiate favourable terms. With competing demands for our capital, we often haven’t been able to follow our money, and this has resulted in situations where we have been significantly diluted.”
The Sancus BMS division was created last year to manage the Platform Black and Funding Knight P2P brands, which were renamed Sancus Finance and Sancus Funding, respectively. The two platforms were later merged into a single Sancus UK brand.