Pre-Close Trading Update

24 March 2020

TruFin plc

("TruFin" or the "Company" or together with its subsidiaries "TruFin Group")

Pre-Close Trading Update

TruFin announces an update on trading for the year ended 31 December 2019, current trading and outlook. The Company currently expects to announce its 2019 full year results in May 2020.

2019 financial highlights from continuing operations (unaudited)

·      Combined gross revenues from continuing operations were £7.3m for 2019 (£4.4m in 2018, representing 66% growth)

·      Loss before tax from continuing operations was £11.8m for 2019 (£9.8m in 2018)

Balance sheet update as at 31 January 2020 (unaudited)

The material tangible assets of the Company, as at 31 January 2020, were not less than:

·      £4.6m of cash or cash equivalents

·      £13.9m loan payable by Distribution Finance Capital Ltd. This loan is due to be repaid, in tranches, by the end of December 2020 (£5.0 million was repaid in December 2019)

·      £3.5m of assets within Satago Financial Solutions Limited's loan book

·      £2.0m share of net assets in Vertus Capital Limited

The TruFin Group has no more than £3.3m in near-term liabilities.

Expectations for 2020

The Group's businesses are not short of opportunity, however TruFin remains capital constrained. This may continue for the short to medium term, both as a result of the COVID-19 pandemic and also as a result of ongoing uncertainty amongst potential lenders concerning the intentions of TruFin's largest shareholder, Arrowgrass Master Fund Limited ("AMFL"), which announced in September 2019 that it would be closing its fund, leading in due course to the divestment of its investment positions.

The Group has recently been in dialogue with AMFL and AMFL has requested the appointment of a Director representative, as per the relationship agreement agreed at the time of the TruFin IPO. A further announcement will be made in due course in respect of this matter. 

Whilst the impact of the COVID-19 pandemic on each of our businesses is currently very difficult to assess, we continue to believe that they are exposed to markets with attractive underlying growth drivers. 

Oxygen Finance Group Limited ("Oxygen") has a market leading position with a customer base of predominantly public sector clients who, collectively during 2019, had invoices totalling c.£550m, which were eligible for discounts to be applied. At this stage, Oxygen continues to anticipate growing their client base to 50 clients by the end of 2020, and to increase the eligible invoices which can attract a discount to £650m during 2020. However, these estimates may need to be revised down in light of customer behaviour as the COVID-19 pandemic unfolds. 

Vertus Capital Limited ("Vertus") funds IFA consolidation, and is therefore exposed to an attractive longer-term trend, as more individual IFAs retire and others consolidate to increase their resilience.  Vertus expects to reach a £16m loan book by year end, with an average asset yield of 9%.

Satago Financial Solutions Limited ("Satago") is now selling subscriptions of its software, vindicating the significant investment it has made in its technology platform. Like Vertus, Satago has not lacked high quality lending opportunities, but has been constrained by available balance sheet.  Satago recently signed a £5m revolving credit facility with a specialist niche funder to continue its expansion and service its growing pipeline.

PlayIgnite Limited's ("PlayIgnite") underlying customers are mobile gaming companies. As PlayIgnite sources capital through Satago it has been capital constrained and as a result is now sourcing capital from external debt providers in order to satisfy customer demand.

James van den Bergh, TruFin CEO, said:

"TruFin has many dedicated employees who, despite the uncertainty, are striving to deliver on their ambitious targets. Although the full impact of the Coronavirus has yet to be felt by the Group, it will inevitably have an effect and we will update shareholders when we feel able to accurately measure the impact. I would like to thank our shareholders for their continued support."

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014 (MAR). For the purposes of MAR, this announcement is being made on behalf of the Company by James van den Bergh, Chief Executive Officer.

For further information, please contact:

About TruFin plc:

TruFin plc is the holding company for an operating group of companies that are niche lenders and early payment providers. TruFin Group combines the benefits of both the traditional relationship banking model and developments in the fintech sector. The Company was admitted to AIM in February 2018 and trades under the ticker symbol: TRU. More information is available on the Company website www.TruFin.com

Forward looking statements

This announcement contains forward looking statements with respect to the business, strategy and plans of the company and its current goals and expectations relating to its future financial condition and performance. Statements that are not historical facts, including statements about the TruFin Group or management's beliefs and expectations, are forward looking statements. By their nature, forward looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. TruFin's actual future results may differ materially from the results expressed or implied in these forward-looking statements as a result of a variety of factors. These include UK domestic and global economy and business conditions, risks concerning borrower credit quality, market related risks including interest rate risk, inherent risks regarding market conditions and similar contingencies outside TruFin's control, any adverse experience in inherent operational risks, any unexpected developments in regulation or regulatory and other factors.