Amigo makes progress with wind-down process
By Josh White
Date: Friday 22 Nov 2024
(Sharecast News) - Amigo, the former mid-cost credit provider now in run-off, reported its interim financial results on Friday, reflecting significant progress in its wind-down process under the fallback scheme.
The company said it reduced its claims provision by 80% to £40.8m for the six months ended 30 September, down from £208m a year earlier, due to the payment of claims and associated expenses.
Proceeds from loan sales and previously charged-off debt generated a £2m credit in impairments.
Cash reserves declined to £22.5m from £121.6m a year earlier, following refunds, operational costs, and transfers of surplus funds to the scheme.
Net assets were minimal at £0.1m, reflecting the wind-down's focus on scheme creditors, with no anticipated return to shareholders.
Amigo's loan book was fully sold after the reporting period, with remaining loans being written off as further sales were deemed commercially unviable.
Pre-tax losses narrowed to £0.1m compared to £6.7m in the same period last year, as costs related to the legacy business were already provisioned at year-end.
Operationally, Amigo said it had processed 99.98% of claims under the scheme, paying £85.1m in refunds and £72.9m in cash redress to claimants.
A small number of creditors were yet to provide payment details, delaying final scheme payments.
The firm said it completed the sale of its legacy loan portfolios through a competitive process and relocated to smaller premises in July, reflecting reduced operational needs.
Corporate strategy remained uncertain as the company explored reverse takeover opportunities following a capital raise in April and May, which provided about four months of runway.
Should no viable solution emerge before available funds were exhausted, Amigo said it intended to seek shareholder approval for delisting from the London Stock Exchange and entering voluntary liquidation.
Jim McColl joined the board in September to assist in exploring alternative paths for the company, but the future of Amigo remained contingent on finding a suitable opportunity before cash reserves were depleted.
Reporting by Josh White for Sharecast.com.
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