07 March 2024

Funding Circle Holdings plc (“Funding Circle”) today announces results for the twelve months ended 31 December 2023.

"I’m pleased with our 2023 performance. We delivered a solid set of results in FY 2023, in line with our expectations, and made good progress against our multi product strategy. In the UK, we have expanded our product range with the rollout of our Card product so customers can now borrow, pay and spend with Funding Circle. Our UK Loans business was profitable and our FlexiPay business grew strongly with transactions nearly quadrupling. We continue to deliver a superior experience for our customers.

“Looking ahead, we will be focused on our UK business – comprising UK Loans and FlexiPay – to drive improved Group cash and profits and deliver greater shareholder value. Whilst the US business offers attractive long term growth, it also requires a significant amount of cash and capital to grow the SBA proposition and we don’t believe that this is the best course of action for the Group. We have received indications of interest for the US business and will update further in due course.

“Our go forward UK business will be PBT profitable in H2 2024 and has an attractive growth and profitability profile over the medium term. We look forward to executing against our plan to help more SMEs get the funding they need to win and to capture growth in a large, underserved market.

“We believe the share price materially undervalues the business and as such will be buying back up to £25m shares."

Lisa Jacobs


Executive Summary:

  • We delivered a solid Group performance in line with expectations:
    • Total income grew 7% to £162.2m (FY 2022: £151.0m); Group AEBITDA of negative £3.9m (FY 2022: £9.5m) with strong profit in UK Loans offset by continued investment into FlexiPay and the US business.
    • Profitable UK Loans business with AEBITDA of £21.3m (FY 2022: £13.8m) and PBT of £6.5m (FY 2022: loss before tax of £1.8m). FlexiPay transactions almost quadrupled to £234m (FY 2022: £59m).
    • Loan returns remain robust and attractive with continued institutional investor demand to fund loans; £1.1bn of forward flow agreements in the UK.
  • We continue to execute against the three strategic pillars of our medium-term plan:
    • Attract more businesses: strengthening existing distribution channels and expanding into new embedded and intermediated channels to enable more businesses to reach us.
      • FlexiPay extends our product range so customers can now borrow, pay and spend with Funding Circle, driving increased relevance and attracting new customers.
      • Launched second year of sports sponsorship with Premiership Rugby and secured Jamie George as our brand ambassador, driving increased brand metrics.
    • Say yes to more businesses: serving more businesses through an expanded set of Funding Circle products and further integration with third party lenders.
      • Marketplace (where we refer businesses we cannot support to other lenders) showing continued strong momentum, with over £100m UK lending through 2023.
      • Continued innovation in core product with expanded product offering via the third iteration of the UK government Recovery Loan Scheme since August.
    • #1 in new products: using our capabilities to enter new markets where we can develop marketleading products.
      • FlexiPay transactions grew ~4x in 2023, with £297m FlexiPay transactions since launch.
      • Completed FlexiPay card launch – now available to new and existing customers, with over 6,600 cards issued so far.
  • Looking ahead, we are focused on a profitable UK business with attractive growth prospects, which we believe will deliver greater shareholder value:
    • Received early indications of interest in the US business and will provide an update in due course.
    • Go-forward UK business combines scalable and profitable UK Loans business with high-growth FlexiPay business.
    • Over the next 3-4 years we expect net income growth of 15-20% CAGR with PBT margins of >15%

Performance Highlights







i) Loans Originations



ii) FlexiPay Transactions



Loans under Management (LuM):



i) Loans under Management



ii) FlexiPay Balances



Key Financials:



Operating income



Net investment income2



Total income



Fair value gains



Net income






Loss before taxation






Net assets



Financial Summary:

  • Loans Originations growth of 2% to £1.5bn (2022: £1.4bn) reflects prudent approach to lending. Commercial lending saw strong growth.
  • LuM reduced to £3.3bn (2022: £3.7bn), reflecting the repayment of government loans.
  • FlexiPay saw continued momentum with transactions almost quadrupling to £234m (2022: £59m) and end of month balances up to £56m (2022: £18m).
  • Operating income grew to £154.8m (2022: £133.7m) following origination yield increases, income from FlexiPay and improved interest on corporate cash.
  • Net investment income was £7.4m (2022: £17.3m) and, as expected, continues to reduce as investments amortise down or have been sold.
  • Fair value gains of £8.7m (2022: £4.8m) from the strong credit performance of on balance sheet loans.
  • AEBITDA of negative £3.9m (2022: positive £9.5m) reflects planned investment in both the US Loans business and FlexiPay.
  • The UK Loans business was AEBITDA positive at £21.3m (2022: £13.8m) and profitable at a PBT level at £6.5m (2022: loss before tax of £1.8m).
  • Loss before tax was £33.2m (2022: loss before tax of £12.9m) reflecting the above planned investments.
  • Net assets remain robust at £246.8m (2022: £284.0m), with the reduction down to investment in the US Loans business and FlexiPay. Group cash is £221.4m (2022: £177.7m), of which £169.6m (2022: £165.6m) is unrestricted3.

We set out the following guidance for 2024:

  FY 2024
  UK Loans FlexiPay
Total income >10% growth 3x growth
PBT Margins of 8-12%
AEBITDA margins)
Continued investment,
with losses
at a similar level to

The UK businesses (UK Loans and FlexiPay) will be PBT positive from H2 2024

Board changes
Eric Daniels will not be standing for re-election as a Director at the Company’s AGM on 15 May 2024.

Share buyback
Funding Circle announces that it intends to commence a discretionary programme to purchase ordinary shares of £0.001 each in its share capital, up to maximum consideration of £25 million, because the share price materially undervalues the business. Funding Circle intends to conduct the programme in accordance with and under the terms of and capacity available under the general authority granted by its shareholders at its Annual General Meeting held on 11 May 2023, subject to available distributable reserves. Funding Circle will announce further details of the programme separately.

Analyst presentation:
Management will host an analyst and shareholder presentation and conference call at 9:30am UK time (GMT), on Thursday 7 March 2024, including an opportunity to ask questions.

To watch and listen to the webcast, with the opportunity to submit written questions, please use this link to register and gain access to the event.

For conference call access, with the opportunity to ask live questions, please dial +44 33 0551 0200 or +1 786 697 3501. Quote Funding Circle when prompted by the operator.

An on-demand replay and transcript will also be available on the Funding Circle website following the presentation.

Funding Circle Investor Relations
Tony Nicol

Joint corporate brokers
Investec: Bruce Garrow / Kamalini Hull (+44 20 7597 4000)
Deutsche Numis: Stephen Westgate / Jamie Loughborough (+44 20 7260 1000)

Funding Circle Media Relations
Angeli Everitt (+44 20 3830 1325)

Headland Consultancy
Mike Smith / Stephen Malthouse (+44 20 3805 4822)

About Funding Circle:
Funding Circle (LSE: FCH) is the UK’s leading SME lending platform. Its mission is to build the place where small businesses get the funding they need to win.

Funding Circle enables small businesses to access funding – offering an unrivalled customer experience powered by data and technology.

For institutional investors, Funding Circle provides access to an alternative asset class in an underserved market, with robust and attractive returns.

Globally, Funding Circle has extended more than £16bn in credit to c.150,000 businesses.

Forward looking statements and other important information:
This document contains forward looking statements, which are statements that are not historical facts and that reflect Funding Circle’s beliefs and expectations with respect to future events and financial and operational performance. These forward looking statements involve known and unknown risks, uncertainties, assumptions, estimates and other factors, which may be beyond the control of Funding Circle and which may cause actual results or performance to differ materially from those expressed or implied from such forward looking statements. Nothing contained within this document is or should be relied upon as a warranty, promise or representation, express or implied, as to the future performance of Funding Circle or its business. Any historical information contained in this statistical information is not indicative of future performance. The information contained in this document is provided as of the dates shown. Nothing in this document should be construed as legal, tax, investment, financial, or accounting advice, or solicitation for or an offer to invest in Funding Circle.

[1]To improve clarity and to better reflect our evolving business, we made certain changes to the presentation of our financial results within our Half Year 2023 results which are reflected in our Full Year 2023 results. All interest earned is now shown within Total Income (and consequently AEBITDA), where previously interest earned on cash was presented below operating profit. With no meaningful other items between operating profit and profit before tax we no longer present an operating profit line item. Comparative financial information has been re-presented with further detail provided in Note 2.

[2]For definitions of non-GAAP measures refer to Note 2.

[3]Unrestricted cash refers to total cash less cash that is restricted in use. The restricted cash is cash that is not available for general use by the company as it is held within investment vehicles and generally payable to third parties.