LendInvest moves closer to break-even as it eyes boost from government housebuilding plans

Property finance platform Lendinvest is steadily approaching a return to the black, following signals that it might benefit from the fresh housing policies of the UK's new government.

The company, which is traded on the London Stock Exchange, recorded a reduced pre-tax loss of £1.7 million for the half-year ending 30 September, 2024, a significant improvement from their £15.7 million loss in the comparable period the previous year, as reported by City AM.

Lendinvest announced that its net operating income rose by 39% to £17.4 million, owing primarily to an increase in fee-driven net income, which surged 71% to hit £11.3 million. Moreover, it managed to trim operating expenses from £28.2 million down to £19.1 million, with its workforce slimming by 16%, now standing at approximately 200 staff members.

Cost efficiencies are further expected as the firm prepares to scale back its office footprint in London and shift some positions to Glasgow. On the operational front, the fintech has experienced a robust 30% growth in new loans over the half-year, amounting to £539.1 million.

Having been in the red with a £27.3 million loss over the past fiscal year, Lendinvest is setting its sights on posting profits for the financial year of 2025. It reached run-rate profitability as of September and maintains a "cautiously optimistic" stance on achieving break-even in the near term.

However, since its initial public offering in 2021, Lendinvest's shares have tumbled by a stark 87%. An additional dip of 1.6% was noted in the early trading hours on Monday.

LendInvest's Chief Executive Rod Lockhart commented on the company's recent performance as "encouraging", but he also noted that volatility in interest rates, driven by macroeconomic and geopolitical uncertainty, might create "present headwinds" for the latter half of the financial year. "However, we are reassured by supportive UK government measures aimed at catalysing housebuilding, improving energy efficiency and professionalising the buy-to-let sector," Lockhart continued.

He expressed a cautious optimism: "As such, we remain cautiously optimistic about achieving run-rate profitability during the rest of the year."