Amigo Holdings PLC: Interim results for the six months ended 30 September 2020

Amigo Holdings PLC (LSE: AMGO)this morning announces its half year results for the six months ended 30 September 2020.

Commenting on the results, Gary Jennison, CEO of Amigo, said: “It’s undoubtedly been a difficult period for Amigo but as a team we have made significant progress towards quantifying and addressing the challenges we face. As a Board we have a clear responsibility to all our stakeholders: from delivering the right outcomes for our customers as they manage the impact of Covid-19, to managing the wellbeing of our employees, and getting the business back on track for our shareholders.

“We are much better placed operationally to manage complaints and we now understand our position better. We have appointed professional advisors to help us look at all the available options; this work is at a very early stage. Where we’ve seen evidence of very poor behaviour by some CMCs, we have reported them to their regulator, the FCA. Our focus is on ensuring that Amigo retains its position as a viable unsecured lending platform for the 10-12m adults who are excluded from mainstream bank lending. We want to meet the varied needs of these potential customers, be that through offering guarantor loans or other unsecured loan products.

“We are engaging with our regulator, the FCA, on a regular basis and are actively participating in the Woolard Review. There are millions of people that cannot access mainstream finance today but deserve a chance to be able to access it tomorrow. We want to be part of the solution for increasing financial inclusion in the UK, that is our purpose and what we are working towards delivering in 2021.”


  • Covid-19 related payment holidays granted to approximately 56,000 customers as at 30 September 2020. As at end of October this was 57,000 with 22,000 plans still active. Monthly collections remain robust at 83% of pre-Covid-19 expectations
  • Revenue reduction of 36.5% to £92.3m (H1 2020: £145.4m) primarily due to the temporary pause in all new lending except to key workers and the modification loss arising from Covid-19-related payment holidays
  • Net loan book reduction of 33.6% to £485.2m (H1 2020: £730.7m)
  • Impairment:revenue ratio at 21.1% (H1 2020: 31.1%) reflecting a significant reduction in originations
  • The provision for complaints increased to £159.1m (H1 2020: £7.5m) with an associated cost of £93.7m (H1 2020: £10.4m), following a review of the volume assumptions within our forward-looking provision to reflect ongoing higher levels of complaints
  • Reported statutory loss before tax for the period of £62.6m (H1 2020: profit £42.3m)
  • The tax charge predominately reflects the write off of a deferred tax asset
  • Reported statutory loss after tax for the period of £67.9m (H1 2020: profit £37.0m)
    £134.2m of cash as at 30 September 2020 (H1 2020: £27.9m) after a reduction in net borrowings of £230.8m from the prior year; cash as at 25 November 2020 of c.£160.0m reflects continued strong cash generation and a refund of tax paid
  • Net borrowings/equity: 2.7x (H1 2020: 2.0x)
  • The Board considers that it has adequate liquidity to continue to fund operations and support its customers. There is, however, a material uncertainty surrounding going concern due to the potential economic impact of Covid-19, uncertainty over future complaint volumes and the possible outcome of the ongoing FCA investigation.

Post period end

  • Complaints Voluntary agreement (VReq) deadline reached. As of 30 October 2020, Amigo had reviewed and reached a decision on all 25,571 of the complaints included within the VReq. Final responses were outstanding on 2,517 of those complaints, 2,209 relate to a specific group of complaints where guarantor payment has been a feature and 238 relate to complaints where further information is required from third parties to calculate redress due
  • Asset Voluntary agreement (VReq) entered into with the FCA whereby prior approval from the FCA is required to transfer assets outside of the Group. No effect on day to day running of Amigo or ability to pay down debt
  • An extension to the waiver period on the Group’s securitisation facility has been agreed in principle. We expect to announce confirmation of this shortly. During this waiver period, performance triggers will remain waived and all collections from securitised assets will be used to pay down the outstanding borrowings
  • Amigo is working with advisers to review options, that are acceptable to all stakeholders, to address the current level of complaints. While at an early stage, this includes assessing the use of a scheme of arrangement as a potential vehicle for customer redress
  • New Board and senior management appointments; well placed to manage the change and transformation required to position Amigo for the long term

*Detailed definitions and calculations of these alternative performance measures (APMs) can be found in the APM section of these condensed financial statements