Half Year Trading Update.

8 July 2025

Distribution Finance Capital Holdings plc

("DF Capital" or the "Company" together with its subsidiaries the "Group")

Half Year Trading Update

Strong H1 performance and launch of new strategic lending offering supports multi-product ambition.

Distribution Finance Capital Holdings plc, a specialist bank providing financial solutions that support dealers and manufacturers across the UK, is pleased to provide a trading update for the six months ended 30 June 2025 (the "period").

Performance

·    The Group is pleased to report strong trading through the period. New loan origination reached a record high, exceeding £828m, up 16.8% on the prior year (H1 2024: £709m) through market share growth in core inventory finance sectors as well as the benefit of new lending product adjacencies.

·    The Group's loan book has continued to grow throughout the second quarter, marginally ahead of expectations, reaching £728m at the period end, up 20.7% on the prior year (H1 2024: £603m). 

·    Stock days, being the average age of loans outstanding, has remained well within sector tolerances at 128 days (31 December 2024: 140 days) at the period end.

·    The Group now supports 97 manufacturer partners and its dealer customers total 1,491 (H1 2024: 1,250).  Credit lines reached a record £1.4 bn, up 27.3% on prior year (H1 2024: £1.1bn). This provides a valuable base to support the Group's multi-product strategy.

·    Overdue accounts have continued to perform in line with expectations through the period, reflecting a continued disciplined approach to scaling lending and a robust focus on credit control. Despite growing customer numbers, in aggregate, 38 dealers had arrears one day past due (H1 2024: 20), representing 2.5% of total dealers, this includes 30 cases in legal recovery where appropriate credit loss provisions have been made in line with the anticipated level of financial recovery. The Group's total arrears balance represented 0.9% (H1 2024: 0.5%) of its entire loan book.

·    The Group has continued to benefit from a very strong net interest margin performance throughout the period and operating expenses have been well managed despite investment into building new products and services.

·    The Group enters the second half with continued momentum, and the Board is confident of achieving full year results in-line with market expectations.

Launch of asset finance

Following the Group's organic build of an asset finance lending capability and the previously reported approval to conduct consumer lending obtained from the Financial Conduct Authority, the Group is pleased to report lending has commenced and first loans have been made. This capability, initially directed towards the Group's motorhome and caravan dealer relationships, unlocks entry into significantly larger addressable markets than the Group's current offering, supporting the sales of its existing dealers and manufacturers to end-user consumers. The Group is pleased to report that it already has over 50 dealers signed up to originate lending, demonstrating the significant interest in these new products and services, as well as the cross-selling potential within its existing dealer network. The Group expects a controlled roll-out of lending in these products over the remainer of 2025 before accelerating in 2026.

Notice of results

The Company will provide a further update when it announces its interim results for the six months ended 30 June 2025 in September 2025.

Carl D'Ammassa, Chief Executive, commented: "We continue to demonstrate our ability to grow loan origination whilst supporting our dealer and manufacturers with more products and services than ever before. Our continued growth is underpinned by a highly digitised and scalable customer journey, enhanced by consistently top-quality support services which resonates strongly with our borrower and retail depositor base.

"The launch of our asset finance product marks an important milestone for the Group and delivers on our long-held ambition to be a multi-product lender. Given these products tap into markets which are significantly larger than our core inventory finance product, it supports our medium-term goal of hitting a loan book of £1.3bn by the end of FY28 and deliver mid-teens return on equity. This, in addition to the Group's performance year to date, leaves the Board confident of achieving market expectations for the full year."

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About DF Capital

DF Capital is a specialist independent bank providing award-winning commercial finance solutions and savings products to consumers and small businesses.

Founded in 2016, the Group is headquartered in Manchester with over 130 people. DF Capital's commercial lending supports, distributors and manufacturers across sectors including Automotive, Leisure and Luxury. In 2020, the Group became a fully authorised bank and started offering a range of consumer savings products.

The Group is listed on AIM on the London Stock Exchange under the ticker DFCH.

For more information, please visit www.dfcapital.bank