Plenti Group progresses towards $1bn loan book following another record quarter
Plenti Group is striving to become cash flow positive by June 2022.
Fintech lender Plenti Group (ASX: PLT) is on its way to achieving a $1 billion loan book after achieving another record with loan originations for the June 2021 quarter 260% higher than the previous corresponding period.
Driving the record performance was a an all-time high of $83.4 million in monthly loan originations for June – representing the sought after $1 billion annual run-rate.
“Reaching a $1 billion loan origination run-rate in June shows we are successfully taking market share and accelerating towards our ambition of achieving a $1 billion loan book during this financial year,” Plenti chief executive officer Daniel Foggo said.
June quarter heralds record start to new financial year
Plenti follows the financial year ending March 2021 (FY 2021), so the June 2021 quarter (Q1 FY2022) heralded a record start to the company’s new 2022 financial year.
In total, Q1 FY2022 brought in $216.4 million of loan originations which was a 26% increase on the March 2021 period (Q4 FY2021).
During the period, Plenti’s loan portfolio rose to $757 million, which was a whopping 96% above the previous corresponding period and 23% higher than the March 2021 quarter.
The area of greatest loan growth was Plenti’s automotive sector, which experienced $114.6 million in loan originations. This was an increase of 345% on Q1 FY2021’s achievement of $25.8 million and 41% higher than Q4 FY2021.
Renewable energy loans also experienced growth, with originations of $20.5 million in Q1 FY2022. This represented a 45% increase on Q1 FY2021 and was up 36% on Q4 FY2021.
Plenti noted the growth in this division was spurred by continued uptake by referral partners of the company’s buy-now-pay-later offering.
Personal loans rocketed 298% from $20.5 million in Q1 FY2021 to $81.4 million in Q1 FY2022. This division was up 7% on Q4 FY2021.
The company pointed out its strong loan origination growth was achieved without comprising credit quality.
Total loan portfolio continues expanding
With record loan origins, Plenti’s total loan portfolio has continued expanding.
The entire loan portfolio value was worth $385 million in Q1 FY2021 and this surged 96% to $757 million in Q1 FY2022.
Compared to Q4 FY2021, this was a 23% rise.
“Loan portfolio growth continues to be weighted towards automotive and renewable energy loans, which typically represent lower credit risk and longer duration loans, helping Plenti to deliver more predictable earnings,” the company stated.
Greater funding capacity
To boost its loan funding further, Plenti has expanded capacity of its automotive warehouse facility to $450 million from $350 million.
The company has also double the capacity of its renewable energy and personal loan facilities from $100 million to $200 million.
“This additional $200 million in funding capacity across our three verticals is another key step towards executing on our growth priorities,” Mr Foggo said.
Strategy to build Australia’s best lender
In the coming months, Plenti’s strategy is to establish market leading positions in each of its lending segments, while reducing its funding costs.
As part of this, Plenti aims to have a $1 billion loan portfolio by March 2022, with a goal of becoming monthly cash net profit after tax positive by June 2022.
“As we continue on our mission to build Australia’s best lender, the exceptional momentum across our business reflects the strength of our offering in each of our verticals and our relentless focus on delivering faster, fairer loans to our partners and customers, Mr Foggo said.