Further expansion for Reward as profits leap
YORKSHIRE-based lender Reward is set to boost its war chest of funds to lend to SMEs after announcing record annual profits.
Backed by South African billionaire Christo Wiese, the Yorkshire-headquartered business has seen profits soar after capitalising on the reluctance of banks to lend to small businesses.
For the year ended February 2014, revenues at the combined Reward businesses were £4.3m, up from £3m the previous year. Operating profit increased by 55% to £3.1m.
Since the year end, Reward has expanded into the North West market with the launch of an office in Manchester and the recruitment of experienced financier Neil McGivern.
The start of its new financial year has also seen Reward, which was launched in 2011, complete 22 transactions, a record number of deals for a single quarter.
Dave Jones and Tom Flannery, the two partners who run the Leeds-based short-term asset backed lender Reward Capital alongside invoice finance provider Reward Commercial Finance, are planning further growth, including the introduction of new product lines.
Commented on the results, Wiese said Reward continued to be boosted by increased confidence in the UK economy.
“Market conditions continued to favour Reward, especially in the case of the short-term loan facilities offered by Reward Capital – which has little direct competition – as such funding remains difficult to obtain from High Street bank,” he said.
“At the same time, Reward Commercial Finance operates in an industry which is also on a substantial growth curve.
“The activities of these two businesses complement each other well, with Reward Commercial Finance providing the needed consistent cash flow.
“With the appointment of several key executives to bolster Reward’s expansion plans in the new financial year we expect the business to further build on its excellent performance in the 2014 reporting period.”
Flannery added: “These results make positive reading for Reward. We forecast further opportunities will continue to come as businesses look for alternative sources of funding to the mainstream banking sector.
“Since early 2012, when Reward realised there was a gap in the market, we have completed well over 100 transactions with £35m of our funds being used in situations including acquisition, refinance, cash flow, stock funding, asset purchase, bridging and turnaround.
“Our services, with speed often being of the essence, are filling a much needed gap in the lending market and helping businesses to maximise opportunities that they may otherwise miss out on.”
Reward presently has £18m of funds to lend, with Wiese, chairman of Tradehold, an investment holding company listed on the main board of the Johannesburg Stock Exchange and the main backer of the group, set to further increase Reward’s war chest following its performance.
