Morses Club PLC (LON:MCL) has secured the addition of one of the UK's leading high street lenders and expanded its existing loan facility by £15mln to fund territory growth, and said builds in progress are performing ahead of expectations.
In a statement, the group – the UK's second largest home collected credit lender – said that, sitting alongside the existing funder, the addition of Shawbrook Bank has increased the overall revolving facility to £40mln from £25mln.
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The AIM-listed firm said the facility has also been extended from its existing expiry date of March 2019 to August 2020.
It added that the increased loan facility will “support the growth strategy of the business, providing the certainty of long-term funding and enabling Morses Club to continue its expansion plans, taking advantage of the current opportunities in the market place.”
The group said that, in particular, the funding will support the growth anticipated from the around 550 self-employed agents and managers who have recently joined the group.
It added that, as well as strengthening the core business, the company anticipates that this will lead to over 400 new agent territory builds in the current financial year.
Territory builds performing ahead of expectations
The group said the territory builds in progress to date are performing ahead of management's expectations set at the beginning of the year, and it is anticipated that this increased level of activity will not have an adverse impact on earnings expectations in full year 2018.
Paul Smith, Morses Club’s chief executive officer said: "We are delighted that two of the UK's leading financial institutions have recognised the strength of our business and will be key financial partners in supporting our growth strategy going forward.”
He added: “This new loan facility will enable us to continue to invest in growth and our product diversification strategy, whilst delivering high quality service to an increasing customer base.”
Smith said the group will update the market further in a trading update on 31 August.