Arrow Global Group has announced its results for the nine months ended 30 September 2017 (Q3 2017).

Commenting on the results Lee Rochford, Group Chief Executive Officer, said “In the first nine months of the year, Arrow continued to grow strongly and profitably. Portfolio purchases in the period increased by 30%, and we are on track to meet our guidance of completing total purchases of approximately £200.0 million by the year end. The capital light asset management business has also seen excellent growth, and we expect this to continue into 2018 following the close of the acquisition of Mars Capital later this year. We are delivering on our One Arrow initiative, investing in the people, processes and systems that the business requires to enhance performance and future efficiency.  As previously guided, the benefit of this programme will start to be realised in 2019.”

“Our focus on consistent, high returns has meant underlying LTM ROE increased to 33.9% – ahead of our guidance of mid-twenties over the medium-term.  We are also executing efficiently on our strategy of diversifying by geography, asset class and revenue stream.  Our consistent delivery, and the growing opportunity across all of our core markets,gives us confidence that we will deliver on expectations for the full year.”

Highlights from the results include:

  • Revenue growth of 41% supported by a 13% increase in core collections and a 64% increase in Asset Management income
  • Zenith performing well and continuing to increase the Group’s Italian market expertise and build valuable relationships
  • Attractive outlook for NPL supply across Arrow’s markets, with support from recent ECB guidance on accelerated provisioning
  •  Overall collections performance at 103% of original underwriting forecasts, underlining the quality of our data and analytics and consistent track record of outperformance
  • One Arrow launched and on track to drive future efficiency gains and sustained growth
  •  84-month ERC increased to £1,455.6 million (Q3 2016: £1,189.6 million)
  • 64% increase in capital-light Asset Management revenues to £50.6 million
  • 6% reduction in financing costs to £33.5 million (Q3 2016: £35.5 million) as benefits of refinancing begin to flow through
  • Long debt duration with average facility maturity of 6.4 years as at 30 September 2017 (30 September 2016: 6.2 years)
  • Secured net debt to adjusted EBITDA reduced to 4.0x, within guided range