Cabot Credit Management delivers strong performance and continued growth as Encore takes the helm

Cabot Credit Management (Cabot), a market leader in European credit management services, today announced the financial results for the six months ending 30th June 2018.

• Capital deployment of £160m at consistent returns
• Continued robust UK back book performance
• Servicing revenue +189% vs H1’17, now 22% of total revenue
• Underlying margins consistent with 2017 – last 12 month Adjusted EBITDA margin 63%
• On track to delivery £6m annual synergies from UK servicing restructure
• Maintaining balance sheet discipline – leverage stable at 4.2x with available liquidity at £153m at 30 June 2018
• Successfully executed bond exchange in July 2018, improving maturity profile and aligning covenants
• Encore acquisition of remaining interest in Cabot completed 24 July 2018

Ken Stannard, Chief Executive Officer, Cabot Credit Management, said: “As Encore announces the completion of its acquisition of the remaining interest in Cabot Credit Management, our company has yet again delivered an excellent quarter with year to date revenues growing 26% compared to the prior year, and delivering Adjusted EBITDA of £318m for the last twelve months.

“Wescot continues to perform strongly as it captures emerging market opportunities, with service revenue now representing 22% of our total revenue. “Our UK back book continues to provide consistent cash generation as we work with our customers to help them achieve their own financial recovery, with 72% of our payments generated from an average of 868,000 regular players each month, and breakage rates remaining at historically low levels.

“We continue to maintain a robust liquidity position, prudent leverage and strong track record of delivering results. This is reflected by the fact that Moody’s upgraded the long term rating of Cabot from B2 to B1 at the end of June and S&P put us on positive outlook. After the end of the quarter, we also successfully closed our bond exchange transaction, enabling us to improve our maturity profile and align bond covenants.”