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Nearly forgot to break the good news. From Credit Today...
Credit Today online
Note there is NO mention of losses incurred due to folks telling them to Feck Off. :tinysmile_twink_t2:
Can't wait until next year. :tinysmile_grin_t:
Credit Today online
Cabot loses £6m as crunch bites collections - 09/09/2009
Debt buyer Cabot Financial lost £6.7m in 2007-08 from a profit of £9.6m the previous year, saying lower consumer collection levels stemming from the credit crunch forced it to cut the value of assets.
However, chief executive Ken Maynard told Credit Today the company is well funded and in a good position to take advantage of portfolios now coming to the market for sale.
The group made an operating profit of £10.8m, down from £25.4m in 2006-07 and its net cash outflow from operating activities was £582,300 - reduced from £4.4m. The figures take its earnings before interest, tax, depreciation and amortisation (EBITDA) to £14.8m from £29.1m in 2007.
In its annual report, Cabot, which acquired portfolios in Spain, Ireland and France as well as the UK, said collections on portfolios for the year to 31 October 2008 fell short of expectations on assets owned at the start of the year. However, it said returns were ahead of expectations on assets bought after that time.
Maynard said the model the company uses to forecast collections on its portfolios is "aggressive" and a period of lower cash collections dramatically affects the value attributed to assets. "The assets have not gone away, we still have them. They are just generating slightly less cash than expected. The value will go back up and we will get a much-needed boost [to the figures] in the next year or two," he said.
He added that investors are happy with the performance as cash flow has not dropped dramatically (falling by £1.7m) and default levels for consumer collection arrangements have not deteriorated. Existing funders Citigroup and Barclays Capital have renewed funding and RBS has joined the consortium. Maynard said the funding line agreed is "substantially more" than the £125m suggested in the report.
The report added: "The directors expect both the turnover and operating profits of the group to grow in the coming years fuelled by cash flows from portfolios currently owned plus the weakening of the price of debt in the UK marketplace."
Cabot last year suffered a setback in plans to expand as Citigroup, which owns its backer Nikko, decided not to make further investments in light of the credit crunch. This halted previous plans to expand rapidly across Europe. At the end of the financial year Cabot had been due to buy 100 per cent of Spanish debt collection agency Gescobro. However, Citi’s decision meant it was forced to sell back its existing 20 per cent stake for £720,052 under the terms of the deal.
Maynard said the last 18 months have been spent assessing existing assets and "tidying up the business". He added that investment restrictions are starting to lift. "We are positive about the next 18 months. There’s going to be quite a few big portfolios coming up and we should be in a very strong position to buy a lot."
He added that unemployment is a key factor in collections and the speed of recovery will depend on whether or not there is a "double dip" in the economy of if recovery continues.
Debt buyer Cabot Financial lost £6.7m in 2007-08 from a profit of £9.6m the previous year, saying lower consumer collection levels stemming from the credit crunch forced it to cut the value of assets.
However, chief executive Ken Maynard told Credit Today the company is well funded and in a good position to take advantage of portfolios now coming to the market for sale.
The group made an operating profit of £10.8m, down from £25.4m in 2006-07 and its net cash outflow from operating activities was £582,300 - reduced from £4.4m. The figures take its earnings before interest, tax, depreciation and amortisation (EBITDA) to £14.8m from £29.1m in 2007.
In its annual report, Cabot, which acquired portfolios in Spain, Ireland and France as well as the UK, said collections on portfolios for the year to 31 October 2008 fell short of expectations on assets owned at the start of the year. However, it said returns were ahead of expectations on assets bought after that time.
Maynard said the model the company uses to forecast collections on its portfolios is "aggressive" and a period of lower cash collections dramatically affects the value attributed to assets. "The assets have not gone away, we still have them. They are just generating slightly less cash than expected. The value will go back up and we will get a much-needed boost [to the figures] in the next year or two," he said.
He added that investors are happy with the performance as cash flow has not dropped dramatically (falling by £1.7m) and default levels for consumer collection arrangements have not deteriorated. Existing funders Citigroup and Barclays Capital have renewed funding and RBS has joined the consortium. Maynard said the funding line agreed is "substantially more" than the £125m suggested in the report.
The report added: "The directors expect both the turnover and operating profits of the group to grow in the coming years fuelled by cash flows from portfolios currently owned plus the weakening of the price of debt in the UK marketplace."
Cabot last year suffered a setback in plans to expand as Citigroup, which owns its backer Nikko, decided not to make further investments in light of the credit crunch. This halted previous plans to expand rapidly across Europe. At the end of the financial year Cabot had been due to buy 100 per cent of Spanish debt collection agency Gescobro. However, Citi’s decision meant it was forced to sell back its existing 20 per cent stake for £720,052 under the terms of the deal.
Maynard said the last 18 months have been spent assessing existing assets and "tidying up the business". He added that investment restrictions are starting to lift. "We are positive about the next 18 months. There’s going to be quite a few big portfolios coming up and we should be in a very strong position to buy a lot."
He added that unemployment is a key factor in collections and the speed of recovery will depend on whether or not there is a "double dip" in the economy of if recovery continues.
Can't wait until next year. :tinysmile_grin_t:
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