Funding Circle Holdings Swings to Expected Pretax Loss in First Half
Funding Circle Holdings swings from profit to loss in the first half, attributing it to higher operating expenses. Net income experiences a slight increase.
Funding Circle Holdings, the U.K. loans platform for small and medium enterprises, has backed its full-year guidance after reporting a pretax loss in the first half of the year. The company, which experienced a swing from profit to loss, attributed the change to higher operating expenses.
In the first half of the year, Funding Circle swung from a pretax profit of GBP1.6 million to a pretax loss of GBP16.6 million. The increase in operating expenses, which rose by 24% to GBP96.2 million, was mainly due to cost increases in the U.S. loans business and investment in its new FlexiPay venture.
Despite this setback, net income saw a slight increase from GBP79.3 million to GBP79.6 million. However, the company reported an adjusted loss before interest, taxes, depreciation, and amortization of GBP3.0 million, compared to adjusted earnings of GBP11.2 million in the same period the previous year.
Funding Circle CEO, Lisa Jacobs, remains optimistic about the company's future growth. "We're making good progress towards our medium-term targets and are in a strong position to grow as the economic backdrop recovers," she said.
Looking ahead, Funding Circle is maintaining its guidance for the year.