The Amigo Holdings PLC (LON: AMGO) share price fell 31.3% after releasing the financial results for the financial year ended 31 March 2023. The company is currently undergoing an orderly wind-down of its business. However, it remains in discussions with some potential funders for its business, the outcome of which is highly unlikely.
YOUR CAPITAL IS AT RISK. 76% OF RETAIL CFD ACCOUNTS LOSE MONEY.
The guarantor lender revealed that its customers shrunk by 60.3% from 73,000 at the end of March 2022 to 29,000 at the end of March 2023. The lender's net loan book also shrunk by 67.1% to £45.4 million from £138.0 million. The company’s revenues also fell by 78.4% to £19.3 million from £89.5 million.
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YOUR CAPITAL IS AT RISK. 76% OF RETAIL CFD ACCOUNTS LOSE MONEY
The provider of mid-cost credit in the UK further noted that the Amigo Scheme of Arrangement sanctioned by the High Court in May 2022 switched to the Fallback solution on 23 March 22023, which mandates an orderly wind-down of the Amigo Loans Ltd business.
Amigo immediately ceased all new lending, leading the company’s board to decide that its financial statements could not be prepared on a going concern basis.
The fallback solution was switched to after the company’s board failed to raise sufficient capital commitments to meet the scheme requirement of £15m redress payment and fund its working capital needs for a total of £45 million.
Amigo intends to run off its existing legacy loans and new RewardRate loans and expects to finalise this process by early 2024. The company is also consulting on how best to make all roles redundant as it winds down its business.
Amigo’s CEO, Danny Malone, commented: “These results come at a very sad time for Amigo. Despite the hard work and dedication of all of Amigo's employees, economic and market conditions made it impossible for the company to raise the capital required to continue lending. Our priority now is to progress the orderly wind-down of the business, ensuring we are able to maximise payments to redress creditors whilst continuing to provide the best level of service possible to our customers and support for our staff. I am grateful to our employees who are giving their all at a very difficult time.”
*This is not investment advice.
Amigo share price.
The Amigo share price fell 31.25% to trade at 0.55p, from Wednesday’s closing price of 0.80p.
YOUR CAPITAL IS AT RISK. 76% OF RETAIL CFD ACCOUNTS LOSE MONEY.