Car Loan company drives up turnover and profits

Wed, 03 Aug 2005



The Funding Corporation (TFC) based in Chester saw an increase in its profitability in 2004. There was a 146.7 percent increase in TFC’s overall turnover with a 212.5 percent growth in profits.

The business is management owned and is funded by Barclays bank and the car dealership IM Group. It is now in its fourth year and saw an increase in its operating profit of 5 million to December 2004, an increase from £1.6 million in 2003.

The above figures were as a result of £118.7 million sales, up from £48.1 million. Outstanding loans were up by 81.6 percent from £157.8 million to £286.5 million.

"When TFC was established in October 2001, it became the biggest start-up finance company in the UK and the biggest company start-up in the UK, of any status, since the mid-1990s. It was a challenging period to say the least, but we focussed and drove forward - and it's paying off," said Jim Rowley, managing director.

TFC is now one of the biggest independent financial services businesses in the UK. Consumers can get loans by using one of TFC’s 100 affinity organisations and 1000 car, caravan and motorcycle dealers. Cars are also sold to the public under an Approved Car Finance scheme.

"Our five-year plan is £1bn worth of loans by October 2006 - we are on target. Given we launched in the economic aftermath of 9/11 it was, of course, initially a massively tough challenge.

"Nevertheless we have found and developed niches, and we have won profitable business in fierce competition with more established providers," said Mr Rowley.

"We have made and agreed affinity deals with more than 100 brands - including RAC Loans most recently.

"We provide finance and loans to their customers, and we have demonstrated an understanding and appreciation of the automotive sector which has taken us into more than 1,000 dealers.

"We have created many jobs in Chester and around the country - headcount rose from 306 to 469 during 2004. We invested in new headquarters premises towards the end of 2004, which means we now have the space to grow even further."

In May 2003 TFC acquired Approved Car Finance as a going concern from the receiver. They turned the business into a profitable operation selling 10,000 cars a year.

In March 2004 TFC acquired the block discounting operations of Abbey Business. This was its first move into business-to-business finance and equally doing well.

Recent indications of growth are seen with TFC's acquisition of Benton Finance, based in Newcastle-upon-Tyne, and County Leasing and Finance in Swansea in March this year.
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