Amigo Holdings (LON: AMGO) sneaked out its full year figures at 6.29pm on Tuesday evening. It is not a great surprise that Amigo, which offers short-term and guarantor loans to people with poor credit, did not want to publicise the figures or its continuing financial problems.
The accounts were required to be published by 2 September or it would have breached the covenants for its 7.625% secured loan notes. It was required to publish accounts within 120 days of the year end, and they were published soon after the results were announced.
In the year to March 2021, revenues slumped from £294.2m to £170.8m, while the loss increased from £37.9m to £283.6m. The impairment charge was £60.7m and 11.8% of the gross loan book is more than two months past its due payment date. Covid-19 has exacerbated the problem.
Complaints cost £318.8m during the year and the complaints provision nearly trebled to £344.6m. That assumes that known and expected complaints are settled in full.
Borrowings have fallen from £460.6m to £296.5m, as the net loan book declines from £643.1m to £340.9m. There is cash in the bank of £177.9m, plus restricted cash of £6.3m. Net liabilities are £121.4m.
Scheme
A scheme of arrangement was agreed with more than 95% of the creditors that voted but it was rejected by the High Court in May. An agreement could reduce the outflow.
Management is trying to come up with a new scheme of arrangement, which is an alternative to the company being insolvent. No scheme and the company may not be able to continue trading, particularly as there is uncertainty about the ability of loanees to pay back the money when furlough ends.
The FCA is still investigating the company and that means that the business cannot be relaunched.
The share price was 8.38p when the market closed on Tuesday – nearly two hours before the announcement. That values the company at £39.8m.
Whether the business is worth anything is dependent on the FCA investigation and any scheme of arrangement that can be agreed by the High Court.