Continued momentum drives doubling of profit for Aldermore Group PLC
Underlying profit before tax(1) up by 109% to £44m
• Net interest margin expanded to 3.6% (H1 2014: 3.3%)
• Underlying cost/income ratio(1) improved by 11pts to 53% (H1 2014: 64%)
• Excellent credit performance; cost of risk improved by 12bps to 20bps (H1 2014: 32 bps)
• Reported profit before tax up by 112% to £40m (H1 2014: £19m)
On track to deliver net loan growth of c£1.4bn in 2015, equivalent to c30% full year growth
• Record first half origination of £1.2bn; up 14% on prior year (H1 2014: £1.0bn)
• Net loans to customers up by £635m or 13% to £5.4bn (31 December 2014: £4.8bn)
• Lending to SMEs up by £270m or 12% to £2.5bn (31 December 2014: £2.2bn)
• Residential Mortgages up by £365m or 14% to £2.9bn (31 December 2014: £2.6bn)
Innovative online deposit franchise funds lending growth
• Customer deposits up by 11% to £5.0bn (31 December 2014: £4.5bn)
• Strong growth in SME deposits, up by 20% to £1.2bn (31 December 2014: £1.0bn)
Successful IPO supports robust capital position
• Total capital ratio(2) of 15.8% (31 December 2014: 14.8%)
• CET 1 capital ratio(2) of 12.0% (31 December 2014: 10.4%)
• Leverage ratio(2) of 7.2% (31 December 2014: 6.3%)
Delivering strong, sustainable returns to shareholders
• Underlying return on equity(1) increased to 18.6% (H1 2014: 11.7%)
• Earnings per share 8.8p (H1 2014: 4.8p)
Phillip Monks, CEO, commented:
“It’s been an excellent six months for the Group, we’ve generated continued growth, doubled profits, listed on the London Stock Exchange and joined the FTSE 250. We’re supporting more customers than ever before with lending to SMEs up by 12% to £2.5bn and Residential Mortgages up by 14% to £2.9bn. Our innovative online deposit business supports this lending and our competitive, transparent products together with the recent launch of our SME Rate Checker have helped drive a 20% increase in SME deposits to £1.2bn.
We’ve more than doubled underlying profit before tax to £44m compared with £21m for the first half of 2014. These excellent results give us great confidence for the rest of 2015 and beyond. We remain committed to delivering strong, sustainable returns to shareholders while generating growth and maintaining our disciplined approach to risk management and increased our underlying return on equity by around 7pts to nearly 19%. We’re also making great progress towards our target of delivering a cost/income ratio of less than 40% by the end of 2017.
We’re excited by the significant ongoing growth opportunity presented by SMEs and homeowners, who we believe continue to be underserved by the wider market. Our track record and the great customer feedback we receive demonstrate that we’re exceptionally well placed to continue to support these customers and grow the business.”
(1) Excluding H1 2015 IPO related costs of £4.1m pre-tax and £3.2m post-tax (H1 2014: £2.2m and £1.7m)
(2) Capital ratios as at 30 June 2015 include H1 2015 profits
