The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 as amended by The Market Abuse (Amendment) (EU Exit) Regulations 2019. The person responsible for making this announcement on behalf of the Company is Rory Mepham.
Sancus Lending Group Limited
("Sancus", the "Company" or "Group")
Interim Results for the six month period ended 30 June 2025
4 September 2025
HIGHLIGHTS
Rory Mepham, Chief Executive Officer of Sancus Lending Group Limited, commented:
"The Group has had an encouraging start to 2025 in what remains, especially in the UK and Channel Islands, a somewhat challenging market environment. In the first half of the year our residential lending businesses in the UK and Ireland, along with our Channel Islands property lending joint venture, have all made further progress in strengthening their market positions and operating platforms. This allowed us to achieve a 9% increase in Assets Under Management ("AUM") to £258.8m (31 December 2024: £237.6m; 30 June 2024: £209m) and deliver Group revenue of £9.7m, a 29% increase on revenue of £7.5m in H1 2024. We have reported a profit before tax of £0.1m compared to a loss before tax of £(0.6m) in H1 2024, supported by a gain of £1.0m from the buy-back of ZDP shares. We know that we need to deliver sustained operating profitability. Our recently strengthened teams, new business pipeline and enhanced funding diversity gives me confidence that we are on track to achieve this ambition."
FINANCIAL HIGHLIGHTS
· Group revenue increased 29% to £9.7m (H1 2024: £7.5m).
· Profit before tax of £0.1m compared to a loss before tax of £(0.6m) in H1 2024.
· New loan facilities written increased 64% to £84.4m (H1 2024: £51.3m).
· AUM increased 9% to £258.8m as at 30 June 2025 from £237.6m as at 31 December 2024 (30 June 2024: £209m).
STRATEGIC AND OPERATING HIGHLIGHTS
· Achievement of £0.1m profit before tax, reflecting improved operating performance and also supported by £1.0m of gains from the buy-back of £1.4m of ZDP shares in H1 2025.
· Good progress in strengthening operating platforms, including further deepening of UK and Irish teams.
o UK AUM increased 14% to £95.6m (31 December 2024: £84.0m; 30 June 2024: £75.8m) with the business writing new facilities of £34.4m (H1 2024: £27.8m).
o Irish AUM increased 29% to £61.7m (31 December 2024: £47.8m; 30 June 2024: £39.2m) with the business writing new facilities of £25.4m (H1 2024: £14.7m).
o Channel Islands AUM decreased slightly to £101.6m (31 December 2024: £105.8m; 30 June 2024: £93.9m) reflecting positive momentum in winding down the legacy Sancus Jersey loan book, with the business also writing £24.6m of new facilities within the joint venture with Hawk ("JV")(H1 2024: £8.8m).
· Further diversification and strengthening of the Group's funding sources:
o Agreement of revised terms for the Company's funding facility with Pollen Street Capital with the facility being increased to £200m and extended to June 2030. We announced in August 2025 that we have entered into a 3 year £20m committed facility with Paragon Bank plc to increase our capacity to grow our lending book in England, Wales and Scotland.
o Continued growth of our private wealth and asset management joint venture, Amberton, helping support diversification of the Group's funding. As at 30 June 2025 Amberton Loan Note AUM were £60.9m, a 46% increase on Loan Note AUM of £41.7m as at 31 December 2024.
· Further strengthening of the Group's capital position and flexibility:
o Repurchase of £1.4m of ZDP shares and adjustment to the terms of the remaining ZDP shares in issue to extend their maturity date to 5 December 2030 and, from 24 June 2025, ceasing the accrual of further interest on these shares.
o The Group also received the necessary approval to amend its corporate bonds to include a payment-in-kind interest option, enabling bondholders to receive rolled-up interest payable at maturity at an annual rate of 8.5% instead of the previous 8% quarterly cash payments.
o Provision of a £10m junior funding commitment by Somerston, the Group's largest shareholder, to support growth in the Group's loan financing facilities. As at 30 June 2025, £4.4m had been drawn down under this commitment.
For further information, please contact:
| Sancus Lending Group Limited Rory Mepham Keith Lawrence
| +44 (0)1481 708 280 |
| Shore Capital (Nominated Adviser and Broker) Tom Griffiths / George Payne (Corporate Advisory) Guy Wiehahn (Corporate Broking)
| +44 (0)20 7408 4050 |
| Instinctif Partners (PR Adviser) Hannah Scott Galyna Kulachek
| +44 (0)20 7457 2020 |
| Apex Group Ltd (Company Secretary) Nikita Pingale Aoife Bennett
| +44 (0)20 3530 3696
|
CHAIRMAN'S STATEMENT
BUSINESS PERFORMANCE AND OUTLOOK
The Group has had an encouraging start to 2025 against an economic backdrop that remains uncertain. The £0.1m profit before tax compares to a loss before tax of £(0.6m) in H1 2024 and was supported by a gain of c. £1.0m on the buy-back of £1.4m of ZDP shares. The 64% increase in the volume of new facilities written of £84.4m (H1 2024: £51.3m), along with the 9% increase in the Group's AUM to £258.8m (31 December 2024: £237.6m) and the Group's encouraging new business pipeline gives the Board confidence that the Group is on track to deliver sustained operating profitability.
CAPITAL AND FUNDING
The Group has successfully taken more steps to diversify its funding and strengthen its capital position.
We have renegotiated the facility we have with funds managed by Pollen Street Capital, increasing the size of the facility to £200m and extending its maturity to June 2030. This, along with the continued growth in the Loan Note Programme managed by our private wealth and asset management joint venture (Amberton), will help support further growth in our AUM. The provision of a £10m junior funding commitment by Somerston, the Group's largest shareholder, will also help support growth in the Group's loan financing facilities.
Our capital position was also strengthened by the repurchase of £1.4m of ZDP shares and adjustments to the terms of the remaining ZDP shares in issue to extend their maturity date to 5 December 2030 and, from 24 June 2025, cease the accrual of further interest on these shares.
DIVIDEND AND SHAREHOLDERS
It is the Board's intention to reinvest surplus resources for growth. As such, the Group does not intend to declare a dividend for the half year period to 30 June 2025. The dividend policy will be revisited when the Company starts to generate capital. In the short term, that capital generation will be deployed into scaling the business.
On behalf of the Board, I would like to thank all shareholders for their continuing support and patience and for the efforts of the management and employees.
As I noted in the Chairman's statement in the 2024 annual report, we remain cautious about the continuing challenges ahead. I firmly believe that we have the right strategy, systems and personnel to put the business onto a stronger footing and return to profitability and I look forward to reporting more positive developments in the coming periods.
Steve Smith
Chairman
3 September 2025
CHIEF EXECUTIVE OFFICER'S REVIEW
OVERVIEW
The first half of 2025 has been one of contrasts for Sancus Lending Group. While we have delivered encouraging financial and operational progress the environment in which we operate - particularly in the UK - has been far from easy.
Confidence across the UK economy remains fragile. Persistent uncertainty, coupled with a broadly negative sentiment in the business and consumer sectors, continued to hold back activity levels in some areas of the lending market. This has created a challenging backdrop for our UK operations. That said, there are some early signs that the downward trajectory of interest rates in the UK could start to stimulate greater momentum in the residential market during the second half of the year and beyond. If this trend continues, we believe it will lead to more positive lending conditions, though we will remain disciplined in our underwriting and selective in our growth.
By contrast, our Irish business has performed strongly in H1 2025 where the market appears to be benefitting from its position in the interest rate cycle, with sentiment and transaction volumes improving. This favourable environment supported a 29% increase in Irish AUM and a 73% increase in new facilities written compared with H1 2024. It is a clear demonstration of how differing macroeconomic dynamics can influence market performance.
Despite the UK headwinds, we grew Group AUM by 9% to £258.8m and increased revenue by 29% to £9.7m. Loan book origination was particularly strong, with £84.4m of new facilities written in the first half, up 64% on H1 2024. Our disciplined approach has allowed us to deliver a profit before tax of £0.1m, a notable turnaround from the £0.6m loss in the prior period, also helped by a gain from the ZDP share buy-back.
OUR STRATEGY
We provide an update below against the strategic pillars set out in our 2024 Annual Report:
| • | Focussing on Revenue Growth o Revenue rose by 29% to £9.7m compared to £7.5m in H1 2024. This increase reflects fee income growth, and the benefits of AUM growth across most of the business. o UK AUM increased 14% to £95.6m (31 December 2024: £84.0m; 30 June 2024: £75.8m) with the business writing new facilities of £34.4m (H1 2024: £27.8m). o Irish AUM increased 29% to £61.7m (31 December 2024: £47.8m; 30 June 2024: £39.2m) with the business writing new facilities of £25.4m (H1 2024: £14.7m). o Channel Islands AUM decreased slightly to £101.6m (31 December 2024: £105.8m; 30 June 2024: £93.9m) with the business writing new facilities of £24.6m (H1 2024: £8.9m).
|
| • | Achieving operating and cost efficiency o Our reported operating expenses were £3.0m versus £2.8m in H1 2024. This increase primarily reflects the cost of recruiting additional staff to support planned business growth, especially in the UK. We continue to take steps to improve our use of technology, including AI, to drive greater efficiency.
|
| • | Become a capital efficient business o We continued to make progress in diversifying our sources of funding. As at 30 June 2025, the Loan Note programme funding managed via the Amberton joint-venture was £60.9m, 46% higher than the balance as at 31 December 2024 (£41.7m). The £25m Morton Family facility which was agreed as part of the joint venture with Hawk Lending Limited is now live. Both the Loan Note programme and the Morton Family facility have interest rates lower than our institutional funding lines. o During the period we also successfully renewed the facility with Pollen Street Capital, increasing its size to £200m and extending its maturity to June 2030 whilst also reducing the cost of funds. As at 30 June 2025 £113.9m of our loans were financed by this facility (31 December 2024: £90m). We announced in August 2025 that we have entered into a 3 year £20m committed facility with Paragon Bank plc to increase our capacity to grow our lending book in England, Wales and Scotland. |
AUM, pro-forma for the joint venture with Hawk Lending, increased by 9% from £237.6m as at 31 December 2024 to £258.8m as at 30 June 2025.
FINANCIAL SUMMARY
H1 2025 profit before tax was £0.1m versus a loss before tax of £(0.6m) in H1 2024. In addition to the revenue growth outlined above, this reflects:
| ○ | Operating expenses of £3.0m versus £2.8m in H1 2024, primarily reflecting the costs of recruiting additional staff to support planned business growth, especially in the UK.
|
| ○ | Group borrowing costs of £1.2m remaining flat from £1.2m in H1 2024 following the purchase of 1.2m ZDP shares in June 2025. This purchase of ZDP shares also resulted in an accounting gain of £1.0m (recorded within "Other net gains").
|
| ○ | £0.2m reduction in expected credit losses (versus a £0.5m credit in H1 2024), reflecting our continued focus on disciplined credit risk management.
|
| ○ | Our share of the profit from our joint venture with Hawk Lending was £0.2m (H1 2024: loss £0.3m).
|
ESG
At Sancus, we are committed to taking Environmental, Social and Governance ("ESG") factors seriously. We recognise our responsibility to incorporate sustainability throughout the operations of our business, to be custodians of the environment and to practise good stewardship of our stakeholders' interests.
Alongside the publication of our 2024 annual report and accounts, we published our second Environmental, Social, and Governance report, marking the start of our journey towards greater transparency and sustainability. The report highlights our progress and achievements in the areas of environmental protection, social responsibility and governance, as well as the challenges and opportunities that we face.
OUTLOOK
We continue to believe there are grounds for optimism and that with our strategic focus and progress the long-term profitable growth potential for our business is clear. Whilst the operating environment was somewhat uncertain in H1 2025 we are cautiously optimistic having entered H2 2025.
Rory Mepham
Chief Executive Officer
3 September 2025
RISKS, UNCERTAINTIES AND RESPONSIBILITY STATEMENT
Risks and uncertainties
There are a number of potential risks and uncertainties which could have a material impact on the Group's performance over the remainder of the financial year. These include, but are not limited to, Capital and liquidity risk, Regulatory and compliance risk, Market risk, Credit risk with respect to the loan book (primarily bridging loans and, increasingly, development loans), Operational risk and the execution of Sancus strategy. These risks remain unchanged from the year ended 31 December 2024 and are not expected to change in the 6 months to the end of the 2025 financial year. Further details on these risks and uncertainties can be found in the 2024 Annual Report.
Responsibility statement
The Directors confirm that to the best of their knowledge:
· The Interim Report has been prepared in accordance with the AIM rules for Companies;
· This financial information has been prepared in accordance with IAS 34 as adopted by the UK;
Approved and signed on behalf of the Board of Directors
3 September 2025
INDEPENDENT REVIEW REPORT ON INTERIM FINANCIAL INFORMATION
Conclusion
We have been engaged by the company to review the condensed set of financial statements in the half-yearly financial report for the six months ended 30 June 2025 which comprise the condensed consolidated statement of comprehensive income, the condensed consolidated statement of financial position, the condensed consolidated statement of changes in shareholders' equity, the condensed consolidated statement of cash flows and related Notes 1 to 21.
Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 30 June 2025 is not prepared, in all material respects, in accordance with UK adopted International Accounting Standard 34 and the AIM Rules of the London Stock Exchange.
Basis of Conclusion
We conducted our review in accordance with International Standard on Review Engagements (UK) 2410, 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
As disclosed in note 2, the annual financial statements of the group are prepared in accordance with UK adopted International Accounting Standards. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with UK adopted International Accounting Standard 34, 'Interim Financial Reporting'.
Conclusions Relating to Going Concern
Based on our review procedures, which are less extensive than those performed in an audit as described in the Basis of Conclusion section of this report, nothing has come to our attention to suggest that management have inappropriately adopted the going concern basis of accounting or that management have identified material uncertainties relating to going concern that are not appropriately disclosed.
This conclusion is based on the review procedures performed in accordance with this ISRE, however future events or conditions may cause the entity to cease to continue as a going concern.
Responsibilities of directors
The directors are responsible for preparing the half-yearly financial report in accordance with the AIM Rules for Companies of the London Stock Exchange.
In preparing the half-yearly financial report, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's Responsibilities for the review of the financial information
In reviewing the half-yearly report, we are responsible for expressing to the Company a conclusion on the condensed set of financial statement in the half-yearly financial report. Our conclusion, including our Conclusions Relating to Going Concern, are based on procedures that are less extensive than audit procedures, as described in the Basis for Conclusion paragraph of this report.
Use of our report
This report is made solely to the Company in accordance with International Standard on Review Engagements (UK) 2410 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Financial Reporting Council for use in the United Kingdom. Our work has been undertaken so that we might state to the Company those matters we are required to state to them in an independent review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company, for our review work, for this report, or for the conclusions we have formed.
Moore Kingston Smith LLP
9 Appold Street,
London,
EC2A 2AP
3 September 2025
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (Unaudited)
|
| Notes | Period ended | Period ended |
|
|
| 30 June 2025 (unaudited)
£'000 | 30 June 2024 (unaudited)
£'000 |
| |
| | |
| Revenue | 4 | 9,683 | 7,499 |
| Cost of sales | 5 | (6,816) | (5,445) |
| Gross profit |
| 2,867 | 2,054 |
| Operating expenses | 6 | (3,002) | (2,846) |
| Group borrowing costs | 7 | (1,159) | (1,182) |
| Changes in expected credit losses | 19 | 232 | 466 |
| Operating loss |
| (1,062) | (1,508) |
| Other net gains | 8 | 1,004 | 1,158 |
| Share of net profit / (loss) of joint ventures accounted for using the equity method | 11 | 192 | (262) |
| Profit / (loss) for the period before tax |
| 134 | (612) |
| Income tax expense |
| (7) | (35) |
| Profit / (loss) for the period after tax |
| 127 | (647) |
|
|
|
| |
| Items that may be reclassified subsequently to profit and loss |
|
| |
| Foreign exchange arising on consolidation |
| 90 | (30) |
| Other comprehensive income / (loss) for the period after tax |
| 90 | (30) |
| Total comprehensive income / (loss) for the period |
| 217 | (677) |
|
|
|
| |
|
|
|
| |
| Basic earnings per share | 9 | 0.04p | (0.12)p |
| Diluted earnings per share |
| 0.04p | (0.12)p |
The accompanying Notes in the 'Notes to the Condensed Interim Financial Statements' section form an integral part of these financial statements.
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION (Unaudited)
|
|
| 30 June 2025 (unaudited) | 31 December 2024 (audited) |
| ASSETS | Notes | £'000 | £'000 |
| Non-current assets |
| | |
| Property, plant and equipment | 10 | 662 | 473 |
| Other intangible assets | 12 | - | - |
| Sancus loans and loan equivalents | 19 | 13,570 | 7,373 |
| FinTech Ventures investments | 19 | - | - |
| Investments in equity-accounted joint ventures and associates | 11 | 14,571 | 14,379 |
| Other investments | 13 | 100 | 100 |
| Total non-current assets |
| 28,903 | 22,325 |
|
|
|
| |
| Current assets |
|
| |
| Sancus loans and loan equivalents | 19 | 101,793 | 85,331 |
| Trade and other receivables | 14 | 14,934 | 11,937 |
| Cash and cash equivalents |
| 11,248 | 2,529 |
| Total current assets |
| 127,975 | 99,797 |
|
|
|
| |
| Total assets |
| 156,878 | 122,122 |
|
|
|
|
|
| EQUITY |
|
| |
| Share capital | 15 | - | - |
| Share premium | 15 | 118,340 | 118,340 |
| Treasury shares | 15 | (1,172) | (1,172) |
| Other reserves |
| (119,012) | (119,229) |
| Total Equity |
| (1,844) | (2,061) |
|
|
|
|
|
| LIABILITIES |
|
|
|
| Non-current liabilities |
|
| |
| Borrowings |
| 154,822 | 121,158 |
| Lease liabilities |
| 476 | 423 |
| Total non-current liabilities | 16 | 155,298 | 121,581 |
|
|
|
| |
| Current liabilities |
|
| |
| Trade and other payables |
| 1,472 | 1,296 |
| Hedging contracts |
| 26 | 2 |
| Tax liabilities |
| 7 | 10 |
| Lease liabilities |
| 91 | 20 |
| Provisions |
| - | 11 |
| Interest payable |
| 1,828 | 1,263 |
| Total current liabilities | 16 | 3,424 | 2,602 |
|
|
|
| |
| Total liabilities |
| 158,722 | 124,183 |
|
|
|
| |
| Total equity and liabilities |
| 156,878 | 122,122 |
The financial statements were approved by the Board of Directors on 3 September 2025 and were signed on its behalf by:
| Director: John Whittle | |
The accompanying Notes in the 'Notes to the Condensed Interim Financial Statements' section form an integral part of these financial statements.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY (Unaudited)
| |
|
| Share Premium | Treasury Shares | Warrants Outstanding | Foreign Exchange Reserve | Retained Earnings/ (Losses) | 207BTotal208BEquity |
| |
|
| 0B£'000 | 1B£'000 | 2B£'000 | 3B£'000 | 4B£'000 | £'000 |
| Balance at 31 December 2024 (audited) |
| 118,340 | (1,172) | - | (70) | (119,159) | (2,061) | |
| Total comprehensive income for the period |
| 10B- | 11B- | 12B- | 13B90 | 14B127 | 217 | |
| Balance at 30 June 2025 (unaudited) |
|
| 15B118,340 | 16B(1,172) | 17B- | 19B 20 | 19B(119,032) | (1,844) |
|
| |
| | | | | | |
| Balance at 31 December 2023 (audited) | | 118,340 | (1,172) | - | 15 | (119,159) | (1,976) | |
| Total comprehensive loss for the period | | 10B- | 11B- | 12B- | 13B(30) | 14B(647) | (677) | |
| Balance at 30 June 2024 (unaudited) | | | 15B118,340 | 16B(1,172) | 17B- | 19B (15) | 19B(119,806) | (2,653) |
The accompanying Notes in the 'Notes to the Condensed Interim Financial Statements' section form an integral part of these financial statements.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)
|
|
| Period ended | Period ended |
|
|
| 30 June 2025 (unaudited) | 30 June 2024 (unaudited) |
| | Notes | £'000 | £'000 |
|
Cash outflow from operations, excluding loan movements
|
17
| (2,194) | (3,175) |
| (Increase) / decrease in Sancus loans |
| (376) | 126 |
| Increase in Sancus Loans Limited loans |
| (22,283) | (8,862) |
| Net cash outflow from operating activities |
| (24,853) | (11,911) |
|
Cash outflow from investing activities |
|
|
|
| Investment in joint ventures | 11 | (250) | (427) |
| Property, plant and equipment and other intangibles acquired | 10 | (89) | (18) |
| Net cash outflow from investing activities |
| (339) | (445) |
|
|
|
|
|
| Cash inflows from financing activities |
|
|
|
| Drawdown of Pollen facility | 17 | 29,574 | 10,000 |
| Issue of preference shares | 17 | 2,500 | 5,000 |
| Issue of bonds | 17 | 3,289 | - |
| Capital element of lease payments | 17 | (36) | (108) |
| Debt issue costs | 17 | (116) | - |
| Purchase of ZDPs | 17 | (1,390) | (1,501) |
| Net cash inflow from financing activities |
| 33,821 | 13,391 |
| |
|
|
|
| Effects of foreign exchange |
| 90 | (30) |
|
|
|
|
|
| Net increase in cash and cash equivalents |
| 8,719 | 1,005 |
|
|
|
|
|
| Cash and cash equivalents at beginning of period |
| 2,529 | 4,990 |
|
|
|
|
|
| Cash and cash equivalents at end of period |
| 11,248 | 5,995 |
The accompanying Notes in the 'Notes to the Condensed Interim Financial Statements' section form an integral part of these financial statements.
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (Unaudited)
1. GENERAL INFORMATION
Sancus Lending Group Limited (the "Company"), together with its subsidiaries, (the "Group") was incorporated, and domiciled in Guernsey, Channel Islands, as a company limited by shares and with limited liability, on 9 June 2005 in accordance with The Companies (Guernsey) Law, 1994 (since superseded by The Companies (Guernsey) Law, 2008). Until 25 March 2015, the Company was an Authorised Closed-ended Investment Scheme and was subject to the Authorised Closed-ended Investment Scheme Rules 2008 issued by the Guernsey Financial Services Commission ("GFSC"). On 25 March 2015, the Company was registered with the GFSC as a Non-Regulated Financial Services Business ("NRFSB"), at which point the Company's authorised fund status was revoked. The Company's Ordinary Shares were admitted to trading on the AIM market of the London Stock Exchange on 5 August 2005 and its issued zero dividend preference shares were listed and traded on the Standard listing Segment of the main market of the London Stock Exchange with effect from 5 October 2015. The Company changed where its business is managed and controlled, from Guernsey to Jersey, effective 1 April 2023. The Board agreed that the Company should revoke its NRFSB status, which was completed on 23 June 2023.
The Company does not have a fixed life and the Company's Memorandum and Articles of Incorporation (the "Articles") do not contain any trigger events for a voluntary liquidation of the Company. The Company is an operating company for the purpose of the AIM Rules for Companies. The Executive Team is responsible for the management of the Company.
The Company has taken advantage of the exemption conferred by the Companies (Guernsey) Law, 2008, Section 244, not to prepare company only financial statements which is consistent with the 2024 Annual Report.
2. ACCOUNTING POLICIES
(a) Basis of preparation
These condensed consolidated financial statements ("financial statements") have been prepared in accordance with International Financial Reporting Standard (IAS) 34 'Interim Financial Reporting', as adopted by the United Kingdom and all applicable requirements of Guernsey Company Law. They do not include all the information and disclosures required in annual financial statements and should be read in conjunction with the Company's annual audited financial statements for the year ended 31 December 2024, which have been prepared in accordance with UK adopted International Accounting Standards.
The Group does not operate in an industry where significant or cyclical variations, as a result of seasonal activity, are experienced during any particular financial period.
These financial statements were authorised for issue by the Directors on 3 September 2025.
(b) Principal accounting policies
The same accounting policies and methods of computation are followed in these financial statements as in the last annual financial statements for the year ended 31 December 2024.
(c) Going Concern
The Directors have considered the going concern basis in the preparation of the financial statements as supported by the Directors' assessment of the Company's and Group's ability to pay its liabilities as they fall due and have assessed the current position and the principal risks facing the business with a view to assessing the prospects of the Company. The Directors have prepared a cash flow forecast for the period to 30 June 2026 which shows that the Company and the Group will have sufficient cash resources to meet their ongoing liabilities as they fall due for at least twelve months from the date of approval of these financial statements. The Group is also profitable with a profit before tax of £0.1m generated in H1 2025 compared to a loss before tax of £0.6m in H1 2024. Following the extension of the ZDP shares and Pollen facility, the Company does not have any debt liabilities that fall due within the next 12 months. Based on this, the Directors are of the opinion that the Company and the Group has adequate financial resources to continue in operation and meet its liabilities as they fall due for the foreseeable future.
It is however expected, whereby equity is required to facilitate an increase in drawdown from institutional funding lines that the Company will require growth capital to fund the continued growth of the loan book. The Company's largest shareholder, Somerston has indicated their willingness to support the Company's growth plans. The Company will be looking at options available to raise such additional growth capital over the course of the year.
The Directors therefore believe it is appropriate to continue to adopt the going concern basis in preparing the financial statements.
(d) Critical accounting estimates and judgements in applying accounting policies
The critical accounting estimates and judgements are as outlined in the financial statements for the year ended 31 December 2024.
3. SEGMENTAL REPORTING
Operating segments are reported in a manner consistent with the manner in which the Executive Team reports to the Board, which is regarded to be the Chief Operating Decision Maker (CODM) as defined under IFRS 8. The main focus of the Group is Sancus. Bearing this in mind, the Executive team have identified four segments based on operations and geography.
Finance costs and Head Office costs are not allocated to segments as such costs are driven by central teams who provide, amongst other services, finance, treasury, secretarial and other administrative functions based on need. The Group's borrowings are not allocated to segments as these are managed by the Central team. Segment assets and liabilities are measured in the same way as in these financial statements and are allocated to segments based on the operations of the segment and the physical location of those assets and liabilities.
The four segments based on geography, whose operations are identical (within reason), are listed below. Note that Sancus Loans Limited, although based in the UK, is reported to the Board separately as a stand-alone entity and, as such, is considered to be a segment in its own right.
1. Offshore
Contains the operations of Sancus Lending (Jersey) Limited, Sancus Lending (Guernsey) Limited, Sancus Properties Limited, Sancus Group Holdings Limited and the JV.
2. United Kingdom (UK)
Contains the operations of Sancus Lending (UK) Limited and Sancus Holdings (UK) Limited.
3. Ireland
Contains the operations of Sancus Lending (Ireland) Limited.
4. Sancus Loans Limited
Contains the operations of Sancus Loans Limited and Sancus Loans No.3 Limited.
| Six months to 30 June 2025
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| Offshore | UK | Ireland | Sancus Loans Limited (SLL) | Sancus Debt Costs | Total Sancus |
| Head Office | SLL Debt Costs | Other |
| Consolidated Financial Statements |
|
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 |
| £'000 | £'000 | £'000 |
| £'000 |
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| Revenue | 246 | 2,230 | 966 | (249) | - | 3,193 |
| - | 6,490 | - |
| 9,683 |
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| | | | | |
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| Operating profit / (loss) * | (85) | 17 | 461 | (269) | - | 124 | | (258) | - | (1) | | (135) |
| Credit losses | 232 | - | - | - | - | 232 | | - | - | - | | 232 |
| Debt costs | - | - | - | - | (1,159) | (1,159) | | - | - | - | | (1,159) |
| Other (losses) / gains | (135) | (4) | (67) | 419 | - | 213 | | 1,041 | - | - | | 1,254 |
| Profit / (loss) on JVs and associates | 192 | - | - | - | - | 192 | | - | - | (250) | | (58) |
| Taxation | - | - | (7) | - | - | (7) | | - | - | - | | (7) |
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| | | | | |
| | | | | |
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| Profit / (loss) After Tax | 204 | 13 | 387 | 150 | (1,159) | (405) |
| 783 | - | (251) |
| 127 |
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| Six months to 30 June 2024
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| Offshore | UK | Ireland | Sancus Loans Limited (SLL) | Sancus Debt Costs | Total Sancus |
| Head Office | SLL Debt Costs | Other |
| Consolidated Financial Statements |
|
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 |
| £'000 | £'000 | £'000 |
| £'000
|
| Revenue | 350 | 2,056 | 719 | (720) | - | 2,405 | | - | 5,094 | - | | 7,499 |
|
| | | | | | | | | | | | |
| Operating profit / (loss) * | (66) | 252 | 261 | (741) | - | (294) | | (493) | - | (5) | | (792) |
| Credit losses | 395 | 24 | - | 47 | - | 466 | | - | - | - | | 466 |
| Debt costs | - | - | - | - | (1,182) | (1,182) | | - | - | - | | (1,182) |
| Other (losses) / gains | (44) | - | 18 | 103 | - | 77 | | 1,131 | - | - | | 1,208 |
| Loss on JVs and associates | (262) | - | - | - | - | (262) | | - | - | (50) | | (312) |
| Taxation | - | - | (35) | - | - | (35) | | - | - | - | | (35) |
|
| | | | | | | | | | | | |
| Profit / (loss) After Tax | 23 | 276 | 244 | (591) | (1,182) | (1,230) | | 638 | - | (55) | | (647) |
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* Operating Profit / (loss) before credit losses and debt costs
Sancus Loans Limited is consolidated into the Group's results as it is a 100% owned subsidiary of the Group. Sancus Loans Limited is considered a Co-Funder, the same as any other Co-Funder. As a result, the Board reviews the economic performance of Sancus Loans Limited in the same way as any other Co-Funder, with revenue being stated net of debt costs. Operating expenses include recharges from Offshore to Ireland £37,000 (2024: £37,000) and Head Office to Offshore £62,500 (2024: £62,500). "Other" includes FinTech (excluding fair value and forex).
| At 30 June 2025
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| Offshore | UK | Ireland | Sancus Loans Limited (SLL) | Total Sancus |
| Head Office | Fintech Portfolio | Other | Inter Company Balances |
| Consolidated Financial Statements | |||
|
| £'000 | £'000 | £'000 | £'000 | £'000 |
| £'000 | £'000 | £'000 | £'000 |
| £'000 | |||
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| |||
| Total Assets | 43,888 | 9,792 | 3,269 | 143,990 | 200,939 | | 42,388 | - | 1 | (86,450) | | 156,878 | |||
| | | | | | | | | | | | | | |||
| | | | | | | | | | | | | | |||
| Total Liabilities | (53,956) | (19,243) | (576) | (143,838) | (217,613) | | (27,558) | - | (1) | 86,450 | | (158,722) | |||
| | | | | | | | | | | | | | |||
| | | | | | | | | | | | | | |||
| Net Assets / (liabilities) | (10,068) | (9,451) | 2,693 | 152 | (16,674) | | 14,830 | - | - | - | | (1,844) | |||
| At 31 December 2024 |
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| Total Assets | 43,602 | 6,949 | 2,843 | 110,572 | 163,966 | | 41,512 | - | 3 | (83,359) | | 122,122 | |
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
| Total Liabilities | (53,870) | (16,418) | (628) | (110,570) | (181,486) | | (26,053) | - | (3) | 83,359 | | (124,183) | |
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
| Net Assets / (liabilities) | (10,268) | (9,469) | 2,215 | 2 | (17,520) | | 15,459 | - | - | - | | (2,061) | |
Head Office liabilities include borrowings £27.2m (December 2024: £25.7m). Other FinTech assets and liabilities are included within "Other"
4. REVENUE
|
| 30 June 2025 (unaudited) | 30 June 2024 (unaudited) |
| | 45B£'000 | 46B£'000 |
| Co-Funder fees | 47B1,457 | 47B1,577 |
| Earn out (exit) fees | 49B344 | 49B350 |
| Transaction fees | 51B1,188 | 51B1,129 |
| Total revenue from contracts with customers | 53B2,989 | 53B3,056 |
| | | |
| Interest on loans | 55B52 | 55B26 |
| Pollen interest income | 57B6,241 | 57B4,375 |
| Asset management fees | 59B401 | 59B42 |
| Total Revenue | 61B9,683 | 61B7,499 |
5. COST OF SALES
|
| 30 June 2025 (unaudited) | 30 June 2024 (unaudited) |
| | 63B£'000 | 64B£'000 |
| Pollen interest cost | 67B6,040 | 67B4,955 |
| Preference share interest costs | 67B412 | 67B140 |
| Irish loan note interest costs | 67B38 | 67B- |
| Other cost of sales | 69B326 | 69B350 |
| Total cost of sales | 71B6,816 | 71B5,445 |
6. OPERATING EXPENSES
|
| 30 June 2025 (unaudited) | 30 June 2024 (unaudited) |
| | 73B£'000 | 74B£'000 |
| | | |
| Administration and secretarial fees | 75B14 | 75B61 |
| Amortisation and depreciation | 77B60 | 60112 |
| Audit fees | 79B151 | 79B184 |
| Corporate insurance | 31 | 81B54 |
| Directors remuneration | 83B64 | 83B88 |
| Employment costs | 85B1,930 | 85B1,662 |
| Investor relations expenses | 87B- | 87B30 |
| Legal and professional fees | 89B104 | 89B93 |
| Marketing expenses | 91B30 | 91B2 |
| NOMAD fees | 93B75 | 93B70 |
| Other office and administration costs | 95B437 | 95B431 |
| Pension costs | 97B75 | 97B40 |
| Registrar fees | 99B22 | 99B15 |
| Sundry | 101B9 | 10194 |
| Total operating expenses | 103B3,002 | 103B2,846 |
7. GROUP BORROWING COSTS
Group borrowing costs reflect the interest cost of the corporate bond and ZDP shares (see note 16).
|
| 115B30 June 2025(unaudited) £'000
| 116B30 June 2024(unaudited) £,000 |
| Group borrowing costs | 127B1,159 | 128B1,182 |
8. OTHER NET GAINS / (LOSSES)
|
| 115B30 June 2025(unaudited) £'000
| 116B30 June 2024(unaudited) £,000 |
| Gains on foreign exchange | 119B352 | 120B121 |
| Loss on joint ventures and associates | 121B(250) | 122B(50) |
| Joint venture recharges | 121B(110) | 122B(44) |
| Lease interest | 125B(28) | 126B- |
| Gain on ZDPs | 125B1,040 | 126B1,131 |
| | 127B1,004 | 128B1,158 |
9. EARNINGS PER SHARE
Consolidated profit / (loss) per ordinary share has been calculated by dividing the consolidated profit / (loss) attributable to ordinary shareholders in the period by the weighted average number of ordinary shares outstanding (excluding treasury shares) during the period.
Note 15 describes the warrants in issue which are currently out of the money and therefore are not considered to have a dilutive effect on the calculation of profit / (loss) per ordinary share.
|
| 30 June 2025 (unaudited) | 30 June 2024 (unaudited) |
|
|
|
|
| Number of shares in issue | 105B584,138,346 | 105B584,138,346 |
| Weighted average number of shares outstanding | 107B584,138,346 | 107B584,138,346 |
| Profit / (loss) attributable to ordinary shareholders in the period | 109B£217,000 | 109B(£(677,000) |
| Basic profit / (loss) per ordinary share | 111B0.04p | 111B(0.12)p |
| Diluted profit / (loss) per ordinary share | 113B0.04p | 113B(0.12)p |
|
| | |
10. PROPERTY, PLANT AND EQUIPMENT
|
| Right of use assets | Property & Equipment | Total |
| Cost | £'000 | £'000 | £'000 |
| At 31 December 2024 | 467 | 439 | 906 |
| Additions in the period | 160 | 89 | 249 |
| At 30 June 2025 | 627 | 528 | 1,155 |
| Accumulated depreciation | £'000 | £'000 | £'000 |
| At 31 December 2024 | 13 | 420 | 433 |
| Charge in the period | 47 | 13 | 60 |
| At 30 June 2025 | 60 | 433 | 493 |
| | | | |
| Net book value 30 June 2025 | 567 | 95 | 662 |
| | | | |
| Net book value 31 December 2024 | 454 | 19 | 473 |
| | | | |
11. INVESTMENTS IN JOINT VENTURES
|
| 115B30 June 2025(unaudited)
| 116B31 December 2024(audited) |
|
| 117B£'000 | 118B£'000 |
| At beginning of year | 119B14,379 | 120B14,255 |
| Additions - joint venture | 121B250 | 122B564 |
| Impairment of joint venture | 125B(250) | 126B(150) |
| Share of net profit / (loss) of joint ventures accounted for using the equity method | 125B192 | 126B(290) |
| | 127B14,571 | 128B14,379 |
The Group has a 50% share in Amberton Limited. Additions in the period include £250,000 of investment in Amberton Limited and which was subsequently written down to a carrying value of £Nil. Amberton Limited, which is a Jersey registered entity, was incorporated in January 2021 and has been established as a joint venture to manage the loan note programme going forward.
On 5 December 2023, the Group entered into a Joint Venture ("JV") agreement with Hawk Family Office Limited for a new bridge and development lending business in the Channel Islands. Sancus Lending (Jersey) Limited ("SLJL") entered into a Business and Asset Purchase Agreement ("BAPA") with Hawk Lending Limited (the previous lending business of Hawk Family Office Limited) and Hawkbridge Limited (the new joint venture lending business) ("Hawkbridge"). Under the terms of the BAPA, SLJL sold to Hawkbridge Limited its business as a going concern including goodwill, business information, movable assets, records and third party rights. The consideration for the business of SLJL was the issue of 12 shares in the newly formed JV holding company, Hawkbridge Limited, giving Sancus Group Holdings Limited a 50% ownership in the JV. Hawkbridge Limited has two wholly owned subsidiaries, Hawkbridge Lending Limited and Westmead Debt Services Limited.
Under the joint venture shareholder agreement, all new Channel Islands lending business will be written through Hawkbridge. Hawkbridge will also provide administration and other services to SLJL and Hawk Lending Limited.
Under IFRS 11, this joint arrangement is classified as a joint venture and has been included in the consolidated financial statements using the equity method.
Summarised financial information in relation to the joint venture is presented below:
|
| 115B30 June 2025(unaudited)
| 116B31 December 2024(audited) |
|
| 117B£'000 | 118B£'000 |
| Current assets | 119B683 | 120B2,835 |
| Non-current assets | 121B30,617 | 122B28,520 |
| Current liabilities | 123B2,158 | 124B2,596 |
| | | |
| Included in the above amounts are: | | |
| Cash and cash equivalents | 125B34 | 126B133 |
| Current financial liabilities (excluding trade payables) | 125B2,095 | 126B2,471 |
| | | |
| Net assets (100%) | 127B29,142 | 128B28,759 |
| Group share of net assets (50%) | 127B14,571 | 128B14,379 |
|
| 115B30 June 2025(unaudited)
| 116B31 December 2024(audited) |
|
| 117B£'000 | 118B£'000 |
| Revenues | 119B666 | 120B710 |
| | | |
| Profit / (loss) and total comprehensive income / (loss) for the period (100%) | 121384 | 122B(580) |
| Group share of total comprehensive income / (loss) (50%) | 123B192 | 124B(290) |
| | | |
| Included in the above amounts are: | | |
| Depreciation and amortisation | 123B2 | 124B2 |
No dividends were received from the JV during the period ended 30 June 2025.
The JV is a private company; therefore no quoted market prices are available for its shares.
The Group has no additional commitments relating to the JV.
12. OTHER INTANGIBLE ASSETS
|
|
£'000 |
| Cost |
|
| At 30 June 2025 and 31 December 2024 | 1,584 |
| |
|
| Amortisation |
|
| At 31 December 2024 | 1,584 |
| Charge for the period | - |
| At 30 June 2025 | 1,584 |
| | |
| Net book value at 30 June 2025 | - |
|
|
|
| Net book value at 31 December 2024 | - |
Other Intangible assets comprise capitalised contractors' costs and costs related to core systems development. The assets have been fully amortised.
13. OTHER INVESTMENTS
Other investments of £100,000 (31 December 2024: £100,000) represents the investment by the Group in non-voting capital in its Loan Note programme entities.
14. TRADE AND OTHER RECEIVABLES
|
| 115B30 June 2025(unaudited)
| 116B31 December 2024(audited) |
| Current | 117B£'000 | 118B£'000 |
| Loan fees, interest and similar receivable | 119B14,305 | 120B10,943 |
| Receivable from associated companies | 123B- | 124B3 |
| Other trade receivables and prepaid expenses | 125B629 | 126B991 |
| | 127B14,934 | 128B11,937 |
15. SHARE CAPITAL, SHARE PREMIUM & DISTRIBUTABLE RESERVE
Sancus Lending Group Limited has the power under the Articles to issue an unlimited number of Ordinary Shares of nil par value.
No Ordinary Shares were issued in the period to 30 June 2025 (period to 30 June 2024: Nil).
| Share Capital
| |
| Number of Ordinary Shares - nil par value | |
| At 30 June 2025 (unaudited) and 31 December 2024 (audited) | 129B584,138,346 |
| Share Premium
| |
| Ordinary Shares - nil par value | 130B£'000 |
| At 30 June 2025 (unaudited) and 31 December 2024 (audited) | 131B118,340 |
Ordinary shareholders have the right to attend and vote at Annual General Meetings and the right to any dividends or other distributions which the Company may make in relation to that class of share.
Treasury Shares
|
| 132B30 June 2025(unaudited) Number of shares | 133B31 December 2024(audited) Number of shares |
|
| | |
| Balance at start and end of period / year | 134B11,852,676 | 135B11,852,676 |
|
| 136B30 June 2025(unaudited) £'000 | 137B31 December 2024(audited) £'000 |
|
| | |
| Balance at start end of period / year | 138B1,172 | 139B1,172 |
Warrants in Issue
As at 30 June 2025 there were 89,396,438 warrants in issue to subscribe for new Ordinary Shares at a subscription price of 2.25 pence per ordinary share. The warrants are exercisable on at least 30 days notice within the period ending 31 December 2025. The warrants in issue are classified as equity instruments because a fixed amount of cash is exchangeable for a fixed amount of equity, there being no other features which could justify a financial liability classification. The fair value of the warrants at 30 June 2025 is £Nil (31 December 2024: £Nil).
16. LIABILITIES
| Non-current liabilities | 30 June 2025(unaudited) | 141B31 December 2024(audited) |
| | 142B£'000 | 143B£'000 |
| Corporate bond (1) | 144B20,576 | 145B16,948 |
| Pollen facility (2) | 146B119,262 | 147B89,610 |
| ZDP shares (3) | 148B6,626 | 149B8,773 |
| Preference shares (4) | 148B7,500 | 149B5,000 |
| Irish loan note (5) | 148B858 | 149B827 |
| Lease liability | B476 | 151B423 |
| Total non-current liabilities | 152B155,298 | 153B121,581 |
| Current liabilities | 30 June 2025(unaudited) | 155B31 December 2024(audited) |
|
| 156B£'000 | 157B£'000 |
| Accounts payable | 158B737 | 159B316 |
| Accruals and other payables | 735 | 980 |
| Taxation | 162B7 | 163B10 |
| Interest payable | 166B1,828 | 167B1,263 |
| Hedging contracts (note 19) | 168B26 | 162 |
| Provisions for financial guarantees | 170B- | 171B11 |
| Lease liability | 172B91 | 173B20 |
| Total current liabilities | 3,424 | 174B2,602 |
| Movement on provision for financial guarantees | | |
|
| | 175B£'000 |
| At 31 December 2023 | | 176B18 |
| Profit and loss credit in the year | | 177B(7) |
| At 31 December 2024 | | 178B11 |
| Profit and loss credit in the period | | 179B(11) |
| At 30 June 2025 | | 180B- |
Provisions for financial guarantees are recognised in relation to Expected Credit Losses ("ECLs") on off-balance sheet loans and receivables where the Company has provided a subordinated position or other guarantee (see Note 20). The fair value is determined using the exact same methodology as that used in determining ECLs (Note 19).
(1) Corporate bond
The corporate bond outstanding at 30 June 2025 was £20.6m (31 December 2024: £17m). During the prior year, bondholders approved an extension in the maturity date of the bonds to 31 October 2027 from 31 December 2025 and an increase in the coupon to 8% (2024: 7%). In June 2025, bondholders approved an amendment to the terms of the bonds to introduce a payment-in-kind interest option, allowing bondholders to elect to receive interest rolled up and paid on maturity at an increased rate of 8.5% per annum, instead of the 8% cash coupon paid quarterly.
(2) Pollen facility
Sancus signed a £125m facility agreement with funds managed by Pollen Street PLC ("Pollen") in November 2022. In June 2025, Sancus signed a new 5 year facility agreement with Pollen increasing the facility up to £200m and with a 5 year expiry date (June 2030). This new facility enables Sancus to draw funds in both GBP and EUR.
The Pollen facility has portfolio performance covenants, including that actual loss rates are not to exceed 4% in any twelve month period and underperforming loans are not to exceed 10% of the portfolio. Sancus Group participates 10% on every drawdown with a first loss position on the Pollen facility. Sancus has also provided Pollen with a guarantee, capped at £4m that will continue to ensure the orderly wind down of the loan book, in the event of the insolvency of Sancus Group, given its position as facility and security agent. Refer to Note 20 Guarantees.
(3) ZDPs
The ZDP shares have a maturity date of 5 December 2030 following ZDP shareholders approving a 3 year extension of the final capital entitlement repayment date on 24 June 2025. On this date, the ZDP shareholders also approved the suspension of any further capital growth from 24 June 2025, resulting in the final capital entitlement being £2.0990 per ZDP share. Prior to this date, the ZDP shares accrued interest at an average of 9% per annum.
Under the Companies (Guernsey) Law, 2008 shares in the Company can only be redeemed if the Company can satisfy the solvency test prescribed under that law. Refer to the Company's Memorandum and Articles of Incorporation for full details of the rights attached to the ZDP shares. This document can be accessed via the Company's website, www.sancus.com.
In accordance with article 7.5.5 of the Company's Memorandum and Articles of Incorporation, the Company may not incur more than £30m of long term debt without prior approval from the ZDP shareholders. The Memorandum and Articles (section 7.6) also specify that two debt cover tests must be met in relation to the ZDP shares. At 30 June 2025, the Company was in compliance with these covenants as Cover Test A was 2.32 (minimum of 1.7) and the adjusted Cover Test B was 4.72 (minimum of 2.05). At 30 June 2025, senior debt borrowing capacity amounted to £20.6m. The Pollen facility does not impact on this capacity as it is non-recourse to Sancus.
The Company purchased 1,388,889 ZDP shares of no par value at a price of £1.08 per ZDP share on 29 April 2024 and a further 1,854,910 ZDP shares at a price of £1.08 per ZDP share on 9 December 2024. The ZDP shares purchased in April 2024 are held as treasury shares and the shares purchased in December 2024 were cancelled. 1,157,417 ZDP shares were acquired under a tender offer in June 2025 at a price of 120p per ZDP share. This was financed by the issuance of c. £1.4m Sancus Bonds to Somerston Fintech Limited. The ZDP shares acquired under this tender offer were cancelled.
At 30 June 2025, the Company held 11,894,628 ZDP shares in Treasury (31 December 2024: 11,894,628) with an aggregate value of £24,966,824 (31 December 2024: £23,956,091).
(4) Preference Shares
In April 2024, Somerston Fintech Limited, a subsidiary of Somerston Group, the majority shareholder of the Company, subscribed for £5,000,000 of preference shares in Sancus Loans Limited ("Sancus Loans"). A further £2,500,000 preference shares have been subscribed for in the period to 30 June 2025. The Preference Shares have a non-cash, cumulative coupon of 15% and a maturity date of 23 November 2026.
(5) Irish Loan Note
In November 2024, Sancus Loans No.3 Limited issued a €1,000,000 loan note to Aatazar Unlimited Company. The loan note bears interest at 9% and is repayable in November 2027.
17. NOTES TO THE CASH FLOW STATEMENT
| Cash outflow from operations (excluding loan movements) | | 181B30 June 2025(unaudited) | 182B30 June 2024(unaudited) |
| | | 183B£'000 | 184B£'000 |
| | | | |
| Profit / (loss) for the period | | 185B127 | 185B(647) |
| | | | |
| Adjustments for: | | | |
| Other net gains | | 189B(754) | 189B(1,158) |
| Finance costs | | 191B858 | 191B763 |
| (Profit) / loss on joint venture | | 193B(192) | 193B262 |
| Changes in expected credit losses | | 193B(232) | 193B(466) |
| Taxation | | 195B(3) | 195B(1) |
| Amortisation / depreciation of fixed assets | | 197B60 | 197B112 |
| Amortisation of debt issue costs | | 199B142 | 199B138 |
| | | | |
| Changes in working capital: | | | |
| Trade and other receivables | | 201B(2,765) | 201B(2,292) |
| Trade and other payables | | 203B565 | 203B114 |
| | | | |
| Cash outflow from operations (excluding loan movements) | | 205B(2,194) | 205B(3,175) |
Changes in liabilities arising from financing activities
The table below details changes in the Group's liabilities arising from financing activities, including both cash and non-cash changes. Liabilities arising from financing activities are those for which cash flows were, or future cash flows will be classified in the Group's consolidated cash flow statement as cash flows from financing activities.
|
| 1 January 2025 £'000 |
Payments 1 £'000 |
Receipts 1 £'000 | Debt issue costs 1 £'000 | Amortisation of debt issue costs Non-cash £'000 |
Other Non-cash2 £'000 |
30 June 2025 £'000 |
|
|
|
|
|
|
|
|
|
| ZDP Shares | 8,773 | (1,390) | - | (116) | 22 | (663) | 6,626 |
| Corporate Bond | 16,948 | - | 3,289 | - | 10 | 329 | 20,576 |
| Pollen Facility | 89,610 | - | 29,574 | - | 110 | (32) | 119,262 |
| Preference Shares | 5,000 | - | 2,500 | - | - | - | 7,500 |
| Irish Loan Note | 827 | - | - | - | - | 31 | 858 |
| Lease Liability | 443 | (36) | - | - | - | 160 | 567 |
| Total liabilities | 121,601 | (1,426) | 35,363 | (116) | 142 | (175) | 155,389 |
|
| 1 January 2024 £'000 |
Payments 1 £'000 |
Receipts 1 £'000 | Debt issue costs 1 £'000 | Amortisation of debt issue costs Non-cash £'000 |
Other Non-cash2 £'000 |
30 June 2024 £'000 |
|
|
|
|
|
|
|
|
|
| ZDP Shares | 13,967 | (1,501) | - | - | 13 | (495) | 11,984 |
| Corporate Bond | 14,950 | - | - | - | 13 | - | 14,963 |
| Pollen Facility | 77,169 | - | 10,000 | - | 112 | - | 87,281 |
| Preference Shares | - | - | 5,000 | - | - | - | 5,000 |
| Lease Liability | 282 | (108) | - | - | - | - | 174 |
| Total liabilities | 106,368 | (1,609) | 15,000 | - | 138 | (495) | 119,402 |
1These amounts can be found under financing cash flows in the cash flow statement.
2 Comprises Interest accruals and unpaid debt issue costs where applicable.
18. RELATED PARTY TRANSACTIONS
Transactions with the Directors/Executive Team
Non-executive Directors
In the period ended 30 June 2025, the non-executive Directors' annualised fees, excluding all reasonable expenses incurred in the course of their duties which were reimbursed by the Company, were as detailed in the table below:
| | 30 June 2025 |
| 30 June 2024 |
| | £ |
| £ |
| | | | |
| Stephen Smith (Chairman) | 50,000 | | 50,000 |
| John Whittle | 42,500 | | 42,500 |
| Tracy Clarke | 35,000 | | 35,000 |
Total Directors' fees charged to the Company for the period ended 30 June 2025 were £63,750 (30 June 2024: £87,500).
Executive Team
For the period ended 30 June 2025, the Executive Team members' remuneration from the Company, excluding all reasonable expenses incurred in the course of their duties which were reimbursed by the Company, were as detailed in the table below:
| | 30 June 2025 | 30 June 2024 |
| | £'000 | £'000 |
| | | |
| Aggregate remuneration in respect of qualifying service - fixed salary | 120 | 149 |
| Aggregate amounts contributed to Money Purchase pension schemes | 6 | 6 |
| Aggregate bonus paid | 65 | - |
All amounts have been charged to Operating Expenses.
Carlton Management Services Limited sub-lease office space in the Group's offices in Jersey, with a sub lease end date of 30 August 2036 at an annual cost of c.£100,000 p.a.
Somerston Capital Limited sub-lease office space in the Group's offices in the UK at an annual cost of £58,000 p.a.
Tracy Clarke is Managing Director of Carlton Management Services Limited.
From time to time, the Somerston Group may participate as a co-Funder in Sancus loans, on the same commercial terms available to other co-Funders.
In April 2024, Somerston Fintech Limited ("Somerston"), a subsidiary of Somerston Group, the majority shareholder of the Company, subscribed for £5,000,000 of preference shares in Sancus Loans Limited ("Sancus Loans").
On 30 January 2025, Somerston Fintech Limited committed to subscribe for up to £10m of junior funding in the existing or future loan financing facilities of the Group, subject to standard conditions precedent. As at 30 June 2025, Somerston Fintech had provided junior funding of £4.4m under this commitment. This comprised the issuance of £1.9m of Sancus Bonds and the issuance of £2.5m of Preference Shares in Sancus Loans. The Preference Shares have a non-cash, cumulative coupon of 15% and a maturity date of 23 November 2026.
Somerston Fintech Limited also subscribed for c.£1.4m of the Sancus Bond in June 2025 in order to facilitate the buyback of some ZDP Shares.
The Group has not recorded any other transactions with any Somerston Group companies for the period ended 30 June 2025 (2024: none).
Directors' and Persons Discharging Managerial Responsibilities ("PDMR") shareholdings in the Company
As at 30 June 2025, the Directors had the following beneficial interests in the Ordinary Shares of the Company:
| | 30 June 2025 | 31 December 2024 | ||
| | No. of Ordinary Shares Held | % of total issued Ordinary Shares | No. of Ordinary Shares Held | % of total issued Ordinary Shares |
| | | | | |
| John Whittle | 2,138,052 | 0.37 | 2,138,052 | 0.37 |
| Rory Mepham | 7,000,000 | 1.20 | 6,000,000 | 1.03 |
| Robert Morton | 5,000,000 | 0.86 | 5,000,000 | 0.86 |
| James Waghorn | 3,160,204 | 0.54 | 3,160,204 | 0.54 |
| Keith Lawrence | 923,712 | 0.16 | 923,712 | 0.16 |
|
|
|
| | |
In the six month period to 30 June 2025 and the year to 31 December 2024, none of the above received any amounts relating to their shareholding.
Transactions with connected entities
There were no significant transactions with connected entities that took place during the period ended 30 June 2025.
There is no ultimate controlling party of the Company.
19. FINANCIAL INSTRUMENTS - Fair values and risk management
Sancus loans and loan equivalents
|
| 30 June 2025 (unaudited) | 31 December 2024 (audited) |
| Non-current | £'000 | £'000 |
|
|
|
|
| Sancus loans | - | - |
| Sancus Loans Limited loans | 13,570 | 7,373 |
| Total Non-current Sancus loans and loan equivalents | 13,570 | 7,373 |
| | | |
| Current | | |
|
| | |
| Sancus loans | 762 | 386 |
| Sancus Loans Limited loans | 101,031 | 84,945 |
| Total Current Sancus loans and loan equivalents | 101,793 | 85,331 |
| | | |
| Total Sancus loans and loan equivalents | 115,363 | 92,704 |
Fair Value Estimation
The financial assets and liabilities measured at fair value in the Consolidated Statement of Financial Position are grouped into the fair value hierarchy as follows:
| | 30 June 2025 (unaudited) | 31 December 2024 (audited) | ||
| | Level 2 | Level 3 | Level 2 | Level 3 |
| | £'000 | £'000 | £'000 | £'000 |
| | | | | |
| Fintech Ventures investments | - | - | - | - |
| Derivative contracts | (26) | - | (2) | - |
| Total assets / liabilities at fair value | (26) | - | (2) | - |
The classification and valuation methodology remains as noted in the 2024 Annual Report.
All of the FinTech Ventures investments are categorised as Level 3 in the fair value hierarchy. In the past the Directors have estimated the fair value of financial instruments using discounted cash flow methodology, comparable market transactions, recent capital raises and other transactional data including the performance of the respective businesses. Having considered the terms, rights and characteristics of the equity and loan stock held by the Group in the FinTech Ventures investments, the Board's estimate of liquidation value of these assets is £Nil at 30 June 2025 (31 December 2024: £Nil). Changes in the performance of these businesses and access to future returns via its current holdings could affect the amounts ultimately realised on the disposal of these investments, which may be greater or less than £Nil. There have been no transfers between levels in the period (2024: None).
Assets at Amortised Cost
|
| 30 June 2025 | 31 December 2024 |
|
| (unaudited) | (audited) |
|
| £'000 | £'000 |
| Sancus loans and loan equivalents | 115,363 | 92,704 |
| Trade and other receivables | 14,305 | 10,946 |
| Cash and cash equivalents | 11,248 | 2,529 |
| Total assets at amortised cost | 140,916 | 106,179 |
Liabilities at Amortised Cost
|
| 30 June 2025 | 31 December 2024 |
|
| (unaudited) | (audited) |
|
| £'000 | £'000 |
| ZDPs | 6,626 | 8,773 |
| Corporate bond | 20,576 | 16,948 |
| Pollen facility | 119,262 | 89,610 |
| Preference shares | 7,500 | 5,000 |
| Irish Loan Note | 858 | 827 |
| Trade and other payables | 3,874 | 3,012 |
| Provisions in respect of guarantees | - | 11 |
| Total liabilities at amortised cost | 158,696 | 124,181 |
Refer to Note 16 for further information on liabilities.
|
FinTech Ventures Investments
| Total Portfolio |
| 30 June 2025 | £'000 |
| At 31 December 2024 | - |
| Net new investments / loan repaid | - |
| Realised gain recognised in profit and loss | - |
| At 30 June 2025 | - |
|
| Total Portfolio |
| 31 December 2024 | £'000 |
| At 31 December 2023 | - |
| Net new investments / (divestments) | - |
| Realised losses recognised in profit and loss | - |
| At 31 December 2024 | - |
Credit Risk
Credit risk is defined as the risk that a borrower/debtor may fail to make required repayments within the contracted timescale. The Group invests in senior debt, senior subordinated debt, junior subordinated debt and secured loans. Credit risk is taken in direct lending to third party borrowers, investing in loan funds, lending to associated platforms and loans arranged by associated platforms. The Group mitigates credit risk by only entering into agreements related to loan instruments in which there is sufficient security held against the loans or where the operating strength of the investee companies is considered sufficient to support the loan amounts outstanding.
Credit risk is determined on initial recognition of each loan and re-assessed at each balance sheet date. It is categorized into Stage 1, Stage 2 and Stage 3 with Stage 1 being to recognise 12 month ECLs, Stage 2 being to recognise Lifetime ECLs not credit impaired and Stage 3 being to recognise Lifetime ECLs credit impaired.
Foreign Exchange Risk - Derivative instruments
The Treasury Committee Team monitors the Group's currency position on a regular basis, and the Board of Directors reviews it on a quarterly basis. Loans denominated in Euros which are taken out through the Pollen facility are hedged. Forward contracts to sell Euros at loan maturity dates are entered into when loans are drawn in Euros. At 30 June 2025 the following forward foreign exchange contracts were open:
| June 2025
|
|
|
|
|
| |
| ||||||
| Counterparty | Settlement date | Buy Currency | Buy Amount £'000 | Sell currency | Sell amount €'000 | Unrealised gain/(loss) £'000 | |||||||
|
|
|
|
|
|
|
| |||||||
| Corpay | Jun 2025 to July 2025 | GBP | 4,265 | Euro | 5,000 | (26) | |||||||
| | | | | | | | |||||||
| | (26) |
| |||||||||||
| December 2024 |
|
|
|
|
| |
|
|
|
|
|
|
|
|
| Counterparty | Settlement date | Buy Currency | Buy Amount £'000 | Sell currency | Sell amount €'000 | Unrealised loss £'000 |
|
|
|
|
|
|
|
|
| Alpha | Jan 2025 | GBP | 7,667 | Euro | 9,245 | 20 |
| Lumon Risk Management | Jan 2025 | GBP | 36,530 | Euro | 44,170 | (22) |
| | | | | | | |
| | (2) | |||||
No hedging has been taken out against investments in the FinTech Ventures platforms (2024: £Nil).
Provision for ECL
Provision for ECL is made using the credit risk, the probability of default (PD) and the probability of loss given default (PL) all of which are underpinned by the Loan to Value (LTV), historical position, forward looking considerations and on occasion, subsequent events and the subjective judgement of the Board. Preliminary calculations for ECL are performed on a loan by loan basis using the simple formula: Outstanding Loan Value x PD x PL and are then amended as necessary according to the more subjective measures as noted above.
A probability of default is assigned to each loan. This probability of default is arrived at by reference to historical data and the ongoing status of each loan which is reviewed on a regular basis. The probability of loss is arrived at with reference to the LTV and consideration of cash that can be redeemed on recovery.
Movement of provision for ECL
| |
Loans £'000 | Trade Receivables £'000 |
Guarantees £'000
|
Total £'000 |
| Loss allowance at 31 December 2023 | 8,484 | 6,462 | 18 | 14,964 |
| Credit for the year 2024 | (330) | (65) | (7) | (402) |
| Utilised in the year 2024 | (5,093) | (1,047) | - | (6,140) |
| Loss allowance at 31 December 2024 | 3,061 | 5,350 | 11 | 8,422 |
| Credit for the period to June 2025 | (221) | - | (11) | (232) |
| Utilised in the period to June 2025 | (276) | (45) | - | (321) |
| Loss allowance at 30 June 2025 | 2,564 | 5,305 | - | 7,869 |
20. GUARANTEES
The Group undertakes a number of Guarantees and first loss positions which are not deemed to be contingent liabilities under IAS37 as there is no present obligation for these guarantees and it is considered unlikely that these liabilities will crystallise.
Pollen Facility
Sancus Group participates 10% on every loan funded by the Pollen facility, taking a first loss position. Sancus Group Lending Limited has provided Pollen with a guarantee capped at £4m and that it will continue to ensure the orderly wind down of the Pollen funded loan book, in the event of the insolvency of Sancus Group, given its position as facility and security agent. No provision has been provided in the financial statements (2024: £Nil).
Sancus Loan Notes
Loan Note 8 was launched in January 2022 and is closed for new subscriptions with AUM of £33.068m. Loan Note 8 matures on 1 December 2026 and has a coupon of 8% p.a. (payable quarterly), with Sancus providing a 20% first loss guarantee.
Loan Note 9 was launched in October 2024 and is gathering new subscriptions with an AUM of £22.5m as at 30 June 2025. Loan Note 9 matures on 1 October 2029 and has a coupon of between 7.5% and 8.5% p.a. depending on participation level (payable monthly), with Sancus and Hawkbridge providing a 20% first loss guarantee jointly.
Amberton Loan Note 1 is a bespoke note that launched in May 2025, the note has AUM of £5.4m as at 30 June 2025. Loan Note 1 matures on 14 May 2030 and has a coupon of 8% (payable monthly).
Unfunded Commitments
As at 30 June 2025 the Group has unfunded commitments of £66.0m (31 December 2024: £68.4m). These unfunded commitments primarily represent the undrawn portion of development finance facilities. Drawdowns are conditional on satisfaction of specified conditions precedent, including that the borrower is not in breach of its representations or covenants under the loan or security documents. The figure quoted is the maximum exposure assuming that all such conditions for drawdown are met. Directors expect the majority of these commitments to be filled by Co-Funders.
21. EVENTS AFTER THE REPORTING DATE
On 14 August the Group announced that it had entered into a 3 year £20m committed facility with Paragon Bank plc to increase its capacity to grow our lending book in England, Wales and Scotland. The junior capital required for this facility will be provided under the £10m junior funding commitment provided by Somerston Fintech Limited (see Note 18).
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