Profits soar at Reward Capital

REWARD Capital believes its ability to make quick funding decisions is filling a vital gap in the market after the fast-growing Yorkshire lender posted vastly improved profits.

And the team behind the group has outlined plans for further expansion as it continues to provide non-traditional short-term finance to businesses across the UK.

Dave Jones and Tom Flannery run Leeds-based asset based lender Reward Capital alongside invoice discounting facility provider Reward Commercial Finance.

The pair said they expected to complete a record number of deals this year, after providing finance to more than 60 organisations in 2012. Reward’s average deal size to the small and medium-sized enterprise market is £350,000 with deals repaying within an average time of seven months.

Jones said: “We’re absolutely delighted with progress and feel there are outstanding opportunities available to take Reward to the next level.

“We offer flexible and quick funding opportunities that are an ideal support for businesses who are still finding it difficult to secure finance from mainstream lenders, on many occasions due to demanding timescales. Cash and the ability to move quickly are driving the marketplace.”

For the period ended February 28 2013, revenues at Reward Capital were £3.01m with the lender posting an operating profit of £2.04m, up from £343,000 the previous year.

Reward launched with an original fund of £7m in 2010 with an additional £5m being raised last year.

Jones highlighted a recent deal that saw Reward provide finance for Doncaster-based Websters to purchase, import and refurbish a large tunnelling machine from India and then sell it on to a customer in China as an example of Reward’s ability to help businesses succeed.

Flannery said: “There is a real need out there for Reward’s service and that need is being satisfied by demand, which is backed up by these fantastic results.”

He added that only a minority of Reward’s deals involved distressed businesses, with most situations helping businesses leverage off assets to maximise opportunities where speed is of the essence.

Reward Capital and Reward Commercial Finance are backed by Tradehold, an investment holding company listed on the main board of the Johannesburg Stock Exchange.

Carel Stassen, main board director at Tradehold, said the organisation had exciting growth potential.

Stassen said: “We believe Reward has enormous potential in the present market. The media in the UK reports almost daily on the intransigence of the mainstream banks when it comes to lending and how alternative funding sources are flourishing as a result.

“At the same time, we believe that its potential is not just determined by the present economic climate but that it will continue to flourish, and perhaps even more so, when the economy starts growing again.”