19 January 2023

Distribution Finance Capital Holdings plc

("DF Capital" or the "Company" together with its subsidiaries the "Group")

Trading update for the year ended 31 December 2022

DF Capital, a specialist bank providing working capital solutions to dealers and manufacturers across the UK, announces a trading update for the 12 months ended 31 December 2022.

The Group's growth strategy has continued at pace as new loan originations hit a record £1bn (2021: £690m) through the year. The loan book ended the year at approximately £440m, up 76% on the prior year (31 December 2021: £249m), whilst maintaining a strong net interest margin of at least 6% in spite of rising funding costs. The Group has grown dealer numbers to 998 (2021: 805), carefully managed inflationary pressures in its operating cost and has seen continued low numbers of arrears cases through the year.

DF Capital is also pleased to report the British Business Bank has agreed an initial £175m ENABLE Guarantee, which may also be increased in the future to £350m. This Guarantee commitment provides the Group with incremental capacity to scale its loan book without the need for additional Tier 1 equity capital by up to £75m on the basis of the initial £175m facility and up to £150m if the facility is increased to £350m. The Group continues to explore options to raise non-dilutive Tier 2 capital to further support its product diversification and medium-term growth strategy.

In October 2022, the Company conducted the annual "Best Companies to Work For" survey, to assess employee engagement across the Group. Over 95% of the Group's employees participated in the survey and the Company is pleased to announce its accreditation by Best Companies as an "Outstanding Place to Work".   

The Company expects to announce its audited results for the year ended 31 December 2022 during April 2023.

Carl D'Ammassa, Chief Executive, commented: "It is undoubted that 2022 has been another challenging year for the UK economy, however, despite the on-going uncertainties caused by the global pandemic and the war in Ukraine, I believe the firm has navigated the landscape well. Being an outstanding place to work, having received two-star rating from Best Companies, and now with the additional support of the British Business Bank's ENABLE Guarantee, I believe we have everything in place to help us navigate the uncertainties of 2023, with the ambition to support more manufacturers and dealers as we scale the bank, whilst diversifying our lending activities where market conditions allow. "

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