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Cabot Credit Management Q2 2014 Press Release

Cabot Credit Management, a market leading acquirer and manager of consumer debt, today announced its half-year results for the period ending 30 June 2014.

“The first half of 2014 has been a period of significant growth for Cabot Credit Management as we acquired Marlin Financial Group and deployed a significant amount of capital toward portfolio purchases,” said Ken Stannard, Chief Executive Officer. “We completed key elements of the Cabot and Marlin business integration process and Marlin’s highly regarded legal collections operation is now being applied to Cabot’s existing portfolio.

I’m pleased to announce that Ryan Stanley has recently joined Cabot as our new Operations Director. Ryan comes to us from Encore Capital, where he played a key role in the transaction that established Encore as our majority owner. We expect that Ryan’s appointment will accelerate the transfer of knowledge and expertise between Encore and Cabot. Ryan replaces Steve Mound, who was integral to the growth and success of Cabot. I’d like to thank Steve for his six years of service to the company and wish him the best of luck in his future endeavours.”

Highlights

Sustained growth for Cabot Credit Management

120-month ERC grew 46% to over £1.53 billion compared to the same six month period in 2013
Debt purchase collections increased 37% to £110.5 million compared to the same six month period in 2013
Adjusted EBITDA increased 29% to £80.4 million compared to the same six month period in 2013

Substantial increase in portfolio purchases and robust funding

Portfolio purchases increased 49% to £124.5 million compared to the same six month period in 2013 and exceeded the portfolio purchase total for all of 2013
In May, conformed a number of key terms within the existing Senior Secured Notes to the more favourable terms of the latest issue

Business strategy and operations

Cabot’s preparation for FCA authorisation continues with strong alignment between the consumers’ best interests and Cabot’s ethical culture
Development of the India operation continues on track and is expected to help drive long term cost efficiency
Application of Marlin’s scorecard capability to the Cabot back book of assets is projected to exceed initial projections over time

Key financial results

                                                              H1 2014          H1 2013          % Change

Adjusted EDITDA                                   £80.3m             £62.4m               +29 %

Debt Purchase Collections                   £110.5m          £80.9m               +37 %

Revenue                                                  £118.7m           £88.9m               +34 %

Portfolio Purchases                              £124.5m           £83.8m                +49 %

Cost Income Ratio                                    33.8%             31.8%                  -6 %

 

Teleconference

At 15.00 hours (BST) on 20 August 2014, Cabot Credit Management will hold an audio conference presentation on the company’s performance.  For further details, please visit the Cabot investor website at www.cabotcm.com/investors.

About Cabot Credit Management

Cabot Credit Management is a market leader in debt purchasing, contingency collections, and customer tracing, and is divided into five specialty businesses: Cabot Financial, Cabot Financial Ireland, Apex Credit Management, Apex Discovery Solutions and Marlin Financial Group.

The combined Cabot Credit Management group has purchased assets totalling £11.6 billion, manages over £1 billion of assets on behalf of clients, collects over £29m per month on portfolios it either owns or services on behalf of clients, and has delivered consistently strong financial performance, having grown its business in each of the last 15 years without exception. 

The group, which has purchased over 4 million customer accounts, employs approximately 870 people with offices in Kings Hill, Stratford-upon-Avon, Dublin, Worthing and London. The company prides itself on its ethical values, customer service and high standards. It has an impressive list of accolades including:

Investors in People Gold and Champion awards
Sunday Times Top 100 Best Companies To Work For – 2013
Sunday Times Profit Track 100 – 2013 (Marlin Financial Group)

In addition, Cabot Financial and Apex Credit Management employ a quality management system compliant with ISO 9001:2008.

The controlling shareholder of Cabot Credit Management is Encore Capital Group, an international speciality finance company providing debt recovery solutions, with the remaining equity being held by a fund advised by J.C. Flowers & Co. in addition to company management.

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