Lowell GFKL Group, a European leader in credit management services, recorded strong results for its full year ended 31 December 2016, with a 20% increase in Group Cash EBITDA1 to £254m showing the continuing benefits of the combined business.

Publishing the results today it has also announced that, following the successful merger of the Lowell Group and GFKL, it will rebrand under a unified identity: Lowell.

Financial Highlights

  • Group Cash EBITDA1 up 20% to £254m
    • Growth driven by:
      • 23% increase in Non-Performing Loan (NPL) cash collections
      • 18% increase in 3rd Party Collections (3PC) income
  • 23% year-on-year increase to £306m in portfolio acquisitions
    • 45% of acquisitions from Financial Services clients
    • 32% of acquisitions from Retail clients
    • 18% of acquisitions from Communications clients
  • 29% year-on-year increase to £10.1bn in 3PC Assets under Management (AuM)
  • 120 month gross Estimated Remaining Collections (ERC) of £1.8bn
    • 30% year-on-year increase
    • 39% of 120m ERC to crystalise as cash collections in the first two years
  • Completion of a further bond issuance related to the acquisition of Tesch

Operational Highlights

  • A series of complementary and accretive acquisitions during the year
    • Tesch (September 2016), consolidating our market leadership position in Germany
    • IS Inkasso (May 2016), expanding our geographical reach through establishing a leadership position in Austria
  • Lowell Financial retains 3 Star Exceptional rating with Investors in Customers
  • Continuing focus on consumer experience remains at the forefront of all activities
  • Ongoing compliance within the regulatory environments to deliver best practice across the Group
  • Post year end: unveiling of the new Group shared brand identity and name; providing a clear vision and strategy for the future

Outlook

Lowell has seen the momentum from 2016 continue into the new year with positive trading in its first quarter. The combined business has the fundamentals in place to continue to grow its platforms through 2017 with a clear focus on value creation.

James Cornell, CEO Lowell, said:

“This is a very good set of results for Lowell and demonstrates the strength of our combined business. 2016 was an important year in our growth with a number of strategic acquisitions across Europe, and the completion of an additional bond issuance.

Having successfully merged our businesses we have a clear vision and strategy for the Group. Combined, we exist to improve the financial well-being of clients and consumers with our principled approach and pioneering consumer insight, offering a positive, forward-looking message and a distinctive identity in the sector. Our new brand reflects this. Lowell has proven equity and existing strong positive associations; it is familiar and respected. The new brand will provide a shared identity for clients, consumers, and colleagues alike; one I believe shows our positive direction as a business.

We look to the rest of the year and beyond with confidence.”

 

 

1Cash EBITDA for the three months to 31 December 2015 and on a last 12 months basis to 31 December 2015 is defined as both Lowell’s and GFKL’s Adjusted EBITDA, each as defined in the Offering Memorandum dated 14 October 2015. Cash EBITDA for the three months to 31 December 2016 and on a last 12 months basis post 31 December 2015 is defined as collections on owned portfolios plus other turnover, less collection activity costs and other expenses (which together equals servicing costs) and before exceptional items, depreciation and amortisation.