Funding Circle beats revenue growth forecasts three months on from IPO

Small business lender Funding Circle has beaten its forecasts for revenue growth and loans under management three months after a disappointing debut on the London Stock Exchange.

The company hit revenue growth of 55 per cent in the fourth quarter of 2018, exceeding the 50 per cent guidance which was estimated at the time of its initial public offering (IPO).

Loans under management beat IPO expectations and reached £3.1bn, an increase of 55 per cent on the same period the previous year.

The fourth quarter saw record loan originations of £683m, up 31 per cent from £522m in the same period in 2017, bringing total originations for the year to £2.3bn.

Shares in the company fell more than 24 per cent below its initial price target when it floated in October last year, dropping as low as 334.5p down from the listing price of 440p. Shares are trading at 325p this morning.

In November the British Business Bank announced it would commit to lending up to £150m to UK small businesses through Funding Circle, and in December Waterfall Asset management agreed to invest in £1bn of loans through the fintech giant’s UK platform over a two year period.

Chief executive and co-founder Samir Desai said: “Funding Circle delivered a strong end to 2018 which resulted in exceeding our revenue and loans under management guidance for the year.

“We were pleased to announce a number of new institutional investor transactions in the fourth quarter, which is further validation of the attractive risk-adjusted returns generated on the Funding Circle platform. We enter 2019 with continuing confidence and remain focused on delivering our growth strategy set out at IPO.”