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EPIC: MCL
Market: AIM
52-week High/Low: 163.42p / 100.81p
Sector: Financial
Market Cap: 172.88M
Website: www.morsesclubplc.com Morses Club Plc
Morses Club Plc

Morses Club is a cash generative, UK consumer finance business. Our current business is the result of the successful combination in 2015 of two established brands in the Home Collected Credit ("HCC") market, Morses Club and Shopacheck Financial Services.

We have circa 200,000 customers, spread throughout mainland UK and Northern Ireland, and the second largest market share in the UK HCC market. We operate under an established brand, enjoy a loyal customer base and are building a market-leading UK non-standard consumer finance business.

Need to do more research with a view to buying a few long term, i believe hard to trade in view of wide spread. What has sparked my interest is an article by Ian Pierce Fool.co.uk 29/10/2017. Regarding Neil Woodford known for his ability to unearth often under-the- radar stocks paying out hefty dividends. He states;-


"Another Woodford income holding I like is Morses Club which currently pays out a 4.8% dividend. Some investors may have been scared away from the sector after the recent problems of market leader Provident Financial, but if anything, these problems have made Morses Club even more attractive.

That's because Provident's problems were entirely self-inflicted. It's push to bring self-employed agents in-house led to mass resignations. This was a boon for Morses Club as it hoovered up thousands of these agents, who have taken their customer books with them. In the half year to August, the company's territory builds leapt from 114 to 434 and it's customer numbers jumped 14% to 233,000.

These new customers helped increase the firms revenue for the period by 14% compared to the year prior. Now, pre-tax profits for the period only rose from £8.6m to £8.7m, but this is to be expected as the influx of new agents required substancial forward payments to help them build their books. Over the coming year, these investments should begin to turn into profitable growth for the group as a whole.

With its share priced at only 12 times forward earnings despite a bumper dividend and enviable growth prospects, I believe Morses Club could be a bargain pick at todays prices."



LATEST BROKER VIEWS

Date Broker New target Recomm.
31 Oct finnCap 175.00 Corporate
5 Oct Beaufort... 165.00 Buy
5 Oct Shore Capital N/A Buy
1 Sep Beaufort... 165.00 Buy
31 Aug Shore Capital N/A Buy
21 Aug Beaufort... 155.00 Buy
18 Aug Numis 138.00 Add
4 Jul Shore Capital N/A Hold
3 Jul Numis 138.00 Add
21 Jun Shore Capital N/A Hold

Morses Club PLC
Preliminary results for the 52 weeks ended 24 February 2018
Morses Club PLC (“the Company”, “Morses Club” or “the Group”), the UK’s second largest home collected
credit (“HCC”) lender, is pleased to announce its preliminary results for the 52 weeks ended 24 February
2018.
Financial Highlights
• Continued strong performance with revenue up 17.1% to £116.6m (FY17: £99.6m)
• Adjusted profit before tax increased by 8.5% to £19.2m (FY17: £17.7m); reported profit before tax
increased by 44.6% to £16.2m (FY17: £11.2m)
• Total credit issued increased by 21% to £174.4m (FY17: £144.1m), driven primarily by new territory
builds
• Net loan book growth of 19% to £72.8m (FY17: £61.2m)
• Impairment as a percentage of revenue for the period was 26.1% (FY17: 24.4%), remaining within
our target range
• A 6% increase in customer numbers to 229,000 (FY17: 216,000)
• Secured additional funding in August 2017 to increase overall revolving facility from £25m to £40m
• Adjusted EPS increased by 8% to 11.7p (FY17: 10.8p); Basic EPS increased by 53% to 10.1p (FY17:
6.6p)
• Proposed final dividend of 4.8p (FY17: 4.3p)
Operational Highlights
• Recruitment of c. 600 agents and managers during the year, which translated into 463 territory
builds in FY18
• 21,000 Morses Club Card customers, with £10.6m in loan balances (FY17: £3.9m)
• Technology continues to enhance Morses Club’s offering, improving customer experience, driving
efficiencies and productivity gains and supporting diversification into complementary product areas
• Received full Financial Conduct Authority ("FCA") authorisation
Alternative Performance Measures & Key performance indicators
52-week
period
ended 24
February
2018
52-week
period
ended 25
February
2017
% change
Revenue £116.6m £99.6m 17.1%
Net Loan Book £72.8m £61.2m 19.0%
Adjusted Profit before tax¹ £19.2m £17.7m 8.5%
Reported profit before tax £16.1m £11.2m 43.8%
Adjusted PBT underlying HCC¹ £24.4m £18.9m 29.1%
Adjusted earnings per share¹ 11.7p 10.8p 8.3%
2
Basic earnings per share 10.1p 6.6p 53.0%
Proposed Dividend per share 7.0p 6.4p 9.4%
Cost / income ratio 56.3% 56.9%
Return on assets¹ 22.9% 24.1%
Return on equity¹ 26.5% 27.2%
Tangible equity / average
receivables ratio 92.6% 93.5%
Number of customers ('000) 229 216 6.0%
Number of agents 2,030 1,826 11.2%
Credit Issued £174.4m £144.1m 21.0%
Impairment (% of revenue) 26.1% 24.4%

Still breaking out nicely. Got to think will retrace to go higher, lower indicators overbought. Long term hold in ISA.

That's a great trade Chris. PFG continues to fall so I assume MCL are making further significant inroads.

Thanks CC