Congratulations CCP – another quality performance. The top line...

Congratulations CCP – another quality performance.

The top line results were within a few percent of my projections. The expenses figures were quite a bit higher.

Revenues:

• Receipts from customers and debtors came in at $188m, which was $8m above my projection of $180m.
• The value of the consumer lending book was £121m, $3m below my projection of $124m.
• Debt ledger revenue was $85m which was $3m above my projection of $82m. This is encouraging.
• Consumer lending revenue was $26.1m which was spot on my projection of $26m.
• Total revenue was $112m, $2m above my projection of $110m.

Expenses:
Total expenses came in at $81.8m, compared to my projection of $74.4m.
The main variances were:

• Collection expenses were $6.6m, $700k higher than my figure of $5.9m
• Consumer loan loss provisions were $12.9m, $2.2m higher than my figure
• Marketing was $7.8m, $2.7m higher than my figure  

Overall I read this as a very good news story. I am hoping that the consumer loans provision figure reflects an excessively conservative approach, in which case the excess will be released as profit in later periods.

The marketing figure was a surprise. I am expecting this figure was the result of a decision to aggressively expand the consumer loan book. Hopefully the loan book itself will start to do its own marketing and then the direct marketing budget will be able to be cut back a bit.

Cheers
K