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  • Writer's pictureMark Watson-Mitchell

Time Finance – will tempus soon fugit?

In a fortnight’s time a little finance company that I have followed for decades will be reporting its interim results for the six months to end November 2021.

The company was hit for six during the Covid-19 pandemic, however I consider that it is currently working very hard upon its recovery to its former glories.

It is more a matter of just how it will fare in its next trading year.

My view is that it will stage a very good stride ahead.

The business

Non-bank lender and broker Time Finance (LON:TIME) was set up way back in late 1998, then went on to the AIM market in August 2006.

Over the subsequent three or four years it suffered, like we all did, from the collapse of the financial markets.

By 2015 it was strong enough to acquire Academy Leasing, then seven months later it acquired Bradgate Business Finance, that was in March 2016.

A year later it bought Intelligent Loans, then in June that year both Gener8 Finance and Positive Cashflow Finance came into the growing fold. In December 2017 CarFinance2U was taken over.

Time to sort out the bundle

The bundling together of these small operations, which offered such a range of commercial and personal finance facilities, was inevitable – and that is just what is underway right now as the group totally rebrands under the Time Finance name.

Over the last five years the group has been on an ambitious journey. It has grown from just one site in Bath employing a dozen staff to a nationwide group spread across six sites and with over 150 employees.

Today it is able to provide its customers with asset finance, invoice finance, pure loans, vehicle finance and physical asset-based lending.

The group’s strategy is to focus upon providing or arranging the finance that the UK’s small to medium sized enterprises (SME’s) require to fund their businesses and arranging vehicle and property-backed finance for consumers.

The multi-product range for SMEs includes asset, vehicle, loan and invoice finance facilities.

The group operates a ‘hybrid’ lending and broking model enabling it to optimise business levels through market and economic cycles.


It operates through four trading divisions, which includes Asset Finance, Vehicle Finance, Loan Finance and Invoice Finance.

Its Asset Finance division, representing 53.9% of group sales, finances across various assets, such as construction, manufacturing and engineering machinery, printing equipment, agricultural and forestry equipment, office furniture, software, audio visual and information technology hardware, commercial kitchens and shop fit outs.

Its Invoice Finance division, 27.3% of sales, provides funding and optional credit control service, and also it offers bad debt protection product.

Its Vehicle Finance division, 10.8%, offers fleet and vehicle funding solutions.

Its Loan Finance division, 9.3%, offers business loan, property loan, coronavirus business interruption loan and recovery loan scheme.

As a matter of interest most of the group’s asset, invoice and SME loans are written to ‘own book’, while its consumer and vehicle loans are ‘broked-on’.

Equity holders

There are some 92.5m shares in issue.

Large significant holders include Wellesley Finance (19.2%), GPIM (16.0%), Ronald Russell (11.9%), Aeternitas Imperium Privatstiftlung (3.85%) and James Roberts (0.56%).

Recent Update

In mid-December the group issued an Interim Trading Update which was positive in terms of its recovery. Its gross lending book was up to £121m as at the end of November, compared to £116m at the end of May.

The group’s balance sheet had strengthened with net tangible assets of over £29m at the halfway stage.

It is not all plain sailing yet though, with the economy still in recovery, keeping the management cautious of ongoing uncertainty.

Market View

The market estimates for the current year’s revenue, to end May 2022, range around £26m, with pre-tax profits of some £3.1m, worth 2.7p per share in earnings.

Net assets are likely to end the year at around 60p per share.

It is estimated that the next year could see revenues jump to near £30m, with some £5m of profits, worth 4.5p per share in earnings.

My View

I look forward to the interims being published and then seeing just how brokers will shape their current and next year estimates.

But whatever they conclude I consider that the shares of Time Finance, at now just 23.5p, are well under their realistic value.

They are, quite possibly, now ready for a new run upwards again and through my previously achieved price objective.

(Profile 23.12.20 @ 21.5p set a Target Price of 30p*)

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