Half-year Report

About this update from Distribution Finance Capital Holdings Plc

[{"type":"text","content":"\n \n This announcement contains inside information as stipulated under the UK version of the Market Abuse Regulation (EU no. 596/2014) as it forms part of UK law by virtue of the European Union (Withdrawal) Act 2018 (as amended from time to time). \n 11 September 2025 \n Distribution Finance Capital Holdings plc \n (\"DF Capital\" or the \"Company\" together with its subsidiaries the \"Group\") \n   \n Results for the six months ended 30 June 2025 \n Significant growth and momentum \n Full year profit expected to materially exceed current market guidance \n   \n Distribution Finance Capital Holdings plc, the specialist bank providing working capital solutions to dealers and manufacturers across the UK, today announces its results for the six months ended 30 June 2025. \n \n \n \n \n \n ·    \n \n \n Delivered £9.0m of profit before tax, up c.20% on the comparable period (30 June 2024: adjusted PBT £7.5m). \n \n \n \n \n ·    \n \n \n Record new lending, up c.17% to £828m (30 June 2024: £710m); supported by £1.4bn of facilities (30 June 2024: £1.1bn) and 1,491 dealers (30 June 2024: 1,250). \n \n \n \n \n ·    \n \n \n Loan book reached £728m, (30 June 2024: £603 million; 31 December 2024: £666 million), up c.21% on prior year. \n \n \n \n \n ·    \n \n \n Net interest margin (NIM) remained strong at 7.9% (30 June 2024: 7.8%), continuing to significantly exceed our previously communicated minimum 6% target. \n \n \n \n \n ·    \n \n \n Strong arrears management resulted in low cost of risk at 0.63% (30 June 2024: 0.61% Adjusted Cost of Risk), demonstrated by arrears balances (1 day+ past due and including legal recoveries) remaining low at 0.9% of total loan book. \n \n \n \n \n ·    \n \n \n Continued cost efficiency and management, despite significant investment in asset finance, with improved cost-to-income ratio of 57% (30 June 2024: 59%). \n \n \n \n \n ·    \n \n \n Retail deposits total £688m (30 June 2024: £579 million) from approximately 15,500 accounts. \n \n \n \n \n ·    \n \n \n Adjusted EPS increased to 3.8p (30 June 2024: 3.0p Adjusted EPS). \n \n \n \n \n ·    \n \n \n Adjusted Tangible Net Asset Value (TNAV) per share ended the period at 70.2p (30 June 2024: 59.6p). \n \n \n \n \n \n \n \n \n \n \n \n \n Post period end highlights and outlook \n   \n \n \n \n \n ·    \n \n \n Successful consumer lending authorisation and subsequent launch of asset finance proposition to the market with more than 75 dealers onboarded and first loans made. \n \n \n \n \n ·    \n \n \n Loan book expectations unchanged with FY25 closing position expected to be between £750m and £800m. \n \n \n \n \n ·    \n \n \n c£950m lending capacity based on existing capital and latent headroom within the BBB ENABLE Guarantee facility and Tier 2 facility, with a clear runway to £1.3bn loan book without the requirement for additional Tier 1 equity raise. \n \n \n \n \n ·    \n \n \n The Group is now guiding for medium term NIM in the core inventory lending product of c7% over the medium term (previously 6%). \n \n \n \n \n ·    \n \n \n As a result of our strong performance, particularly in net interest margin, we expect full year profit to materially exceed current market expectations with an improvement in market expectations for FY26 also anticipated. \n \n \n \n \n   \n \n \n \n \n   \n \n \n 30 June 2025 \n \n \n 30 June 2024 \n \n \n 31 December 2024 \n \n \n \n \n \n \n \n 6-month \n \n \n 6-month \n \n \n 12-month \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Financial Highlights \n \n \n \n \n \n \n \n \n \n \n \n \n \n Gross revenues (£m) 1 \n \n \n                         43.3 \n \n \n                         37.9 \n \n \n                         76.8 \n \n \n \n \n Adjusted profit before taxation (£m) 2 \n \n \n                           9.0 \n \n \n                           7.5 \n \n \n                         14.4 \n \n \n \n \n Adjusted profit after taxation (£m) 3 \n \n \n                           6.6 \n \n \n                           5.4 \n \n \n                         10.5 \n \n \n \n \n Gross loan book (£m) 4 \n \n \n                          728 \n \n \n 603 \n \n \n                          666 \n \n \n \n \n Net assets (£m) 5 \n \n \n                       117.6 \n \n \n                       107.6 \n \n \n                       115.4 \n \n \n \n \n Customer deposits (£m) \n \n \n                          688 \n \n \n                          579 \n \n \n                          650 \n \n \n \n \n Regulatory capital (£m) 6 \n \n \n 112 \n \n \n 100 \n \n \n                       109 \n \n \n \n \n Common Equity Tier 1 capital ratio 7 \n \n \n 19.7% \n \n \n 23.2% \n \n \n 21.6% \n \n \n \n \n Regulatory capital (as a % of RWA) 8 \n \n \n 21.7% \n \n \n 25.9% \n \n \n 23.8% \n \n \n \n \n Gross yield 9 \n \n \n 12.2% \n \n \n 12.1% \n \n \n 12.2% \n \n \n \n \n Net interest margin 10 \n \n \n 7.9% \n \n \n 7.8% \n \n \n 7.9% \n \n \n \n \n Average customer rate for retail deposits 11 \n \n \n 4.80% \n \n \n 5.10% \n \n \n 5.16% \n \n \n \n \n Adjusted cost of risk 12 \n \n \n 0.63% \n \n \n 0.61% \n \n \n 0.75% \n \n \n \n \n Impairment loss coverage on loans to customers 13 \n \n \n 1.06% \n \n \n 1.32% \n \n \n 0.98% \n \n \n \n \n Cost to income ratio 14 \n \n \n 57% \n \n \n 59% \n \n \n 59% \n \n \n \n \n Adjusted basic earnings per share (pence) 15 \n \n \n                           3.8 \n \n \n                           3.0 \n \n \n                           5.9 \n \n \n \n \n Adjusted tangible net assets per share 16 \n \n \n                         70.2 \n \n \n                         59.6 \n \n \n                         63.8 \n \n \n \n \n Loans advanced to customers (£m) \n \n \n 828 \n \n \n 710  \n \n \n 1,440 \n \n \n \n \n Number of dealer customers 17 \n \n \n 1,491 \n \n \n 1,250 \n \n \n 1,334 \n \n \n \n \n Number of manufacturer partners 18 \n \n \n 97 \n \n \n 90  \n \n \n                             88 \n \n \n \n \n Total credit available to dealers (£m) 19 \n \n \n 1,390 \n \n \n 1,088  \n \n \n 1,142 \n \n \n \n \n   \n Carl D'Ammassa, Chief Executive Officer, commented : \"The Group has made great progress in achieving our strategic ambitions and enjoyed another period of growth which underpins the significant increase in overall profitability. We continue to scale the bank efficiently and the launch of our asset finance product will significantly expand our addressable market opportunity whilst also deepening our relationships with manufacturer and dealer customers in the sectors we currently serve. With this fuller suite of products and services, DF Capital has an abundance of opportunities to grow lending. The foundations are now in place upon which we can build our medium-term growth plans.\" \n \"Given the progress during the period, we expect full year results to be materially ahead of current market expectations, supporting the pace of our journey to deliver on the medium-term targets we laid out at the start of the year including ending FY28 with a loan book of c£1.3bn and a mid-teens return on equity.\" \n An overview video of the results by CEO Carl D'Ammassa is available to watch here :   https://bit.ly/DF_Capital_HY2025_Overview and on the Company's website:  https://www.dfcapital-investors.com/ \n Analyst presentation \n The Company will host an analyst webinar at 9am today relating to the results. Analysts wishing to join can register by emailing  [email protected] \n Investor presentation \n The Company will also provide a presentation to existing and potential shareholders via the Investor Meet Company platform at 12:30pm today. Investors can register for the webinar here:  https://www.investormeetcompany.com/distribution-finance-capital-holdings-plc/register-investor . A recording of the presentation will be made available on the Company's website following the conclusion of the investor presentation. \n The person responsible for arranging the release of this announcement on behalf of the Company is Karen D'Souza (Company Secretary). \n For further information contact: \n \n \n \n \n Distribution Finance Capital Holdings plc \n \n \n   \n \n \n \n \n Carl D'Ammassa - Chief Executive Officer \n \n \n +44 (0) 161 413 3391 \n \n \n \n \n Kam Bansil - Head of Investor Relations \n \n \n +44 (0) 7779 229508 \n \n \n \n \n http://www.dfcapital-investors.com \n \n \n   \n \n \n \n \n Panmure Liberum Limited (Nomad and Broker) \n \n \n +44 (0) 203 100 2000 \n \n \n \n \n Chris Clarke \n \n \n   \n \n \n \n \n William King \n \n \n   \n \n \n \n \n Gaya Bhatt \n \n \n   \n \n \n \n \n Alma Strategic Communications \n \n \n +44 (0) 203 405 0235 \n \n \n \n \n Josh Royston \n \n \n   \n \n \n \n \n Hilary Buchanan \n \n \n   \n \n \n \n \n Hannah Campbell \n \n \n   \n \n \n \n \n Sarah Peters \n \n \n   \n \n \n \n \n   \n About DF Capital \n DF Capital is a speciality lender providing flexible financing solutions that support the sales and growth of manufacturers, dealers and distributors operating in attractive underserved retail markets across the UK. As a bank, DF Capital's lending is underpinned by its award-winning savings products, straightforward digital platform, and exceptional customer service. \n   \n Chief Executive's Statement \n   \n   \n Further strategic progress, unlocking growth and enhancing shareholder value \n   \n DF Capital operates in attractive, specialised lending niches supporting the growth of manufacturers, dealers and distributors operating predominantly in the UK. We support them with their working capital needs, provide tailored bespoke lending products to help them grow and, now having launched our asset finance lending proposition, we also help them sell more of their products and services to their customers directly. \n   \n It is this commitment to the sectors and markets in which we operate that draws a significant distinction to other banks and lenders. We are experts in what we do and deploy this experience, together with our unique digital-first, yet human touch operation, to enable the growth ambitions of our customers. Our lending is enabled by an award-winning deposit raising capability. \n   \n We believe our approach creates a competitive advantage and accordingly I'm delighted to report another period of continued strong strategic and financial momentum, delivering pre-tax profit of £9.0m for the first half of 2025 (adjusted PBT a : 30 June 2024: £7.5m) up c.20% on prior year.  \n   \n The Group's adjusted basic Earnings Per Share (EPS) a and adjusted Tangible Net Asset Value (TNAV) per share a ended the period at 3.8p and 70.2p respectively (30 June 2024: 3.0p and 59.6p respectively), reinforcing our commitment to delivering sustainable shareholder returns and enhancing shareholder value.  \n   \n As you will read in this report, we are pleased with the performance of the Group in the first half, and as a result we expect to materially exceed current market expectations for the current year, supporting the pace of our journey to deliver a mid-to-high teens return on capital over the medium term. \n   \n Disciplined approach to growth continues to underpin strong financial returns \n   \n It is now five years since our full authorisation as a bank; in that time, the Company has seen a material increase in its loan book, supported by its retail savings arm. Looking forward, it is this scaling of lending as a multi-product lender that underpins our franchise and overall profit generation. We've launched more products and services during the period, bringing these to life through a frictionless service underpinned by a human touch when our customers need us.  \n   \n With an expanded suite of products and services, DF Capital has an abundance of opportunities to grow lending. The foundations are now in place to deliver on the medium term (FY28) targets we laid out at the start of the year and which are re-iterated in the outlook section. \n   \n Our growth so far has been, and will continue to be, characterised by a strong yet disciplined approach, successfully navigating macroeconomic volatility, geopolitical uncertainty, and evolving regulatory requirements. \n   \n New loan originations reached a record £828 million in H1 2025, an increase of £118 million compared to the prior period (30 June 2024: £710 million). This drove a substantial increase in the loan book to £728 million (30 June 2024: £603 million; 31 December 2024: £666 million), up c.21% on the prior year. Growth was particularly strong in sectors where the Group maintains a competitive advantage, as we remained focused on gaining market share in resilient, well-understood verticals. \n   \n Gross revenues a , which predominantly consist of net interest income, increased by c.14% to £43.3m (30 June 2024: £37.9m). Despite two Bank of England base rate cuts in the period, net interest margin (\"NIM\") remained robust at 7.9% (30 June 2024: 7.8%), continuing to significantly exceed our previously communicated minimum 6% target. Effective pricing disciplines and prudency in managing our funding cost should allow us to outperform on this important performance indicator over the next 18-24 months; we now expect net interest margin to ultimately settle at c.7% in our core inventory finance lending product.  \n   \n a Gross revenues, adjusted profit before tax, adjusted Basic Earnings Per Share, and adjusted Tangible Net Asset Value per share are Alternative Performance Measures (\"APMs\") as defined in the APM section. \n   \n As at 30 June 2025, DF Capital supported 97 manufacturer partners (30 June 2024: 90; 31 December 2024: 88) and 1,491 dealers (30 June 2024: 1,250; 31 December 2024: 1,334), reflecting our commitment to deepening existing dealer relationships while actively onboarding new customers, and providing a valuable base to support the Group's multi-product strategy. Aggregate dealer loan facilities reached £1.4 billion at the end of the period, up c.28% year-on-year (30 June 2024: £1.1 billion) and c.22% higher than at year-end (31 December 2024: £1.1 billion). Looking forward, we expect the pace of dealer network expansion to moderate as we continue to prioritise credit quality and scalability of relationships over the medium term. \n   \n This strong financial and operational performance, underpinned by resilient credit quality and a growing, diversified customer base, reinforces the Board's confidence in our strategy. Our offering continues to resonate with customers, enabling us to scale efficiently and sustainably. \n   \n Market landscape and sector outlook \n   \n We continue to demonstrate strength in our core inventory finance markets, having a well-diversified portfolio across a broad range of end-user markets. Despite ongoing macroeconomic and geopolitical uncertainty, we are well placed to report strong loan book growth. \n   \n We are mindful of growing caution among some customers as they navigate potential business headwinds-including the impact of fiscal policy changes such as anticipated business rates increases, higher employer national insurance contributions, and the likelihood of persistently elevated interest rates in the near term. Notwithstanding this, we've seen particularly strong momentum in key verticals including motorhomes and caravans, marine, motorcycles, and specialist automotive. Despite sector-specific challenges, our growth in these areas has been significant, highlighting the strength of our proposition and the depth of our dealer and manufacturer relationships. \n   \n The following table analyses the portfolio at the reporting date by principal outstanding: \n   \n \n \n \n \n \n \n \n 30 June 2025 \n \n \n 30 June 2024 \n \n \n 31 December 2024 \n \n \n \n \n \n \n \n £million \n \n \n % \n \n \n £million \n \n \n % \n \n \n £million \n \n \n % \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Leisure: \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Lodges and holiday homes \n \n \n  80.5 \n \n \n 11.1% \n \n \n                     117.8 \n \n \n 19.5% \n \n \n  90.8 \n \n \n 13.6% \n \n \n \n \n Motorhomes and caravans \n \n \n  219.4 \n \n \n 30.1% \n \n \n                     163.4 \n \n \n 27.1% \n \n \n  207.5 \n \n \n 31.2% \n \n \n \n \n Marine \n \n \n  83.9 \n \n \n 11.5% \n \n \n                       62.8 \n \n \n 10.4% \n \n \n  71.9 \n \n \n 10.8% \n \n \n \n \n Motorsport \n \n \n  39.6 \n \n \n 5.4% \n \n \n                       33.6 \n \n \n 5.6% \n \n \n  35.0 \n \n \n 5.3% \n \n \n \n \n Automotive \n \n \n  38.8 \n \n \n 5.3% \n \n \n                       21.6 \n \n \n 3.6% \n \n \n  31.2 \n \n \n 4.7% \n \n \n \n \n   \n \n \n  462.2 \n \n \n 63.5% \n \n \n                     399.2 \n \n \n 66.2% \n \n \n  436.4 \n \n \n 65.5% \n \n \n \n \n Commercial: \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Transport \n \n \n  110.1 \n \n \n 15.1% \n \n \n                     104.3 \n \n \n 17.3% \n \n \n  93.0 \n \n \n 14.0% \n \n \n \n \n Industrial equipment \n \n \n  40.5 \n \n \n 5.6% \n \n \n                       32.8 \n \n \n 5.4% \n \n \n  32.9 \n \n \n 4.9% \n \n \n \n \n Agricultural equipment \n \n \n  20.4 \n \n \n 2.8% \n \n \n                       26.2 \n \n \n 4.3% \n \n \n  24.4 \n \n \n 3.7% \n \n \n \n \n Other serialised assets \n \n \n                          4.5 \n \n \n 0.6% \n \n \n                         3.5 \n \n \n 0.6% \n \n \n  4.5 \n \n \n 0.7% \n \n \n \n \n   \n \n \n                     175.5 \n \n \n 24.1% \n \n \n                     166.8 \n \n \n 27.7% \n \n \n  154.8 \n \n \n 23.3% \n \n \n \n \n Wholesale and receivables funding \n \n \n                        84.4 \n \n \n 11.6% \n \n \n                       \n 36.6 \n \n \n 6.1% \n \n \n 74.8 \n \n \n 11.2% \n \n \n \n \n Asset Finance \n \n \n 6.0 \n \n \n 0.8% \n \n \n - \n \n \n 0.0% \n \n \n - \n \n \n 0.0% \n \n \n \n \n Total loan book principal b \n \n \n 728.1 \n \n \n 100% \n \n \n                     602.6 \n \n \n 100% \n \n \n 666.0 \n \n \n 100% \n \n \n \n \n b Principal balance outstanding at the reporting date for loans and advances to customers. \n   \n In the motorhome & caravan sector, industry statistics suggest we are the market leader, taking share from competitors.  End user demand generally across this sector remains high. \n   \n Whilst there has been stronger demand for both motorhomes and caravans since Easter, overall retail sales for touring caravans (tourers) remains down year-on-year. In response, most manufacturers have produced less tourers, resulting in less unsold stock at the forecourts. In contrast motorhomes continue to track in line with the previous year after several years of double-digit growth. \n   \n Holiday home & lodge sales have continued with a more subdued trend, though there is evidence of increased activity in recent months, with sales increasing and parks starting to order more replacement stock. This market continues to adjust following the failure of Royale Park Home Estates and associated companies. Manufacturers, who have been on reduced hours for an extended period, are starting to increase production. \n   \n The marine sector is showing continued signs of renewed momentum. Demand for higher-value boats remains strong, with steady sales recovery in the leisure and luxury segments. While this doesn't yet represent growth across all categories, it's a clear indicator that confidence is returning among well-capitalised buyers, which is fuelling confidence and growing optimism amongst manufacturers and distributors.  \n   \n The high-end automotive sector has continued to perform strongly, driven by resilient demand from affluent buyers and limited production volumes. Despite broader economic uncertainty and tighter credit conditions, the sector has maintained robust order books and healthy margins, particularly in the performance, electric, and SUV segments. \n   \n The plant and machinery segment of the industrial sector has shown steady growth through the year, supported by strong infrastructure investment, ongoing manufacturing modernisation, and the global shift toward cleaner energy. Demand remains high for both new and used equipment, with inventory-backed lending enabling dealers to maintain stock and meet market needs. \n   \n The agricultural sector continues to experience the effects of weather extremes, from last year's prolonged rainfall to this year's dry spring. These shifting conditions have disrupted traditional buying cycles. Machinery sales remain under pressure as farmers adjust their spending amid cost volatility, fluctuating crop values, and weather uncertainty. Despite these headwinds, we've seen the emergence of green shoots of recovery. Stabilising inflation and reducing interest rates should help support confidence. \n   \n Our diversification across these sectors as well as the intimacy in our customer relationships, allow us to successfully navigate market challenges and opportunities, whilst expanding our funding solutions to support their needs through unpredictable times, allowing them to capitalise on opportunities presented to them and, in turn, support their growth. \n   \n Looking forward, we believe the relentless focus on supporting existing manufacturer, dealer and distributor relationships, whilst at the same time diversifying into new markets, will provide further downside protection should certain markets deteriorate. Our recent entry into the renewables asset class, specifically solar panels and batteries, is a great example of how we continue to innovate and develop our product offering to support new and existing customers through our asset-based lending expertise. \n   \n Over and above this, we have also continued to leverage existing relationships and grow our Euro-zone lending, through the Group's subsidiary DF Capital Financial Solutions Limited, to support selective dealers in Republic of Ireland and Netherlands. At the period end, we had a total book value of £23m across this customer cohort. Operations for this business line sit entirely in the UK and the Group has no current plans to expand into Europe in any meaningful way. However, developing our capability in this region and being able to selectively support our existing dealer and manufacturer base has allowed us to deepen those relationships and build our knowledge and experience of operating on a multi-currency basis. \n   \n Tailored solutions that deepen relationships and grow markets \n   \n The Group has capitalised on opportunities to support existing customers, partners or known sector participants with tailored lending solutions that deepen our relationship and support the growth and vitality of the markets in which we operate. Drawing on the extensive experience and expertise we have across the Group, we have provided solutions that allow customers to acquire businesses or new locations; unlock further working capital to support growth; enable dealer and manufacturer sales by providing wholesale funding to other non-bank lenders; as well as freeing up distributor working capital via receivables financing. These unique opportunities are tailored to an individual customer or partner's need and offer us attractive risk-adjusted returns whilst fundamentally supporting growth in the markets in which we operate. \n   \n Whilst always expected to be relatively small, and not representing more than 15% of our entire lending balance, we have successfully grown lending in this area to £84.4 in H1 2025 (30 June 2024: £36.6m, 31 December 2024: £74.8m). \n   \n Asset Finance unlocks significant future growth opportunity \n   \n Unlocking the opportunity to provide loans \"beyond the forecourt\" has been a long held strategic imperative for the Group. I am delighted that, following receipt of regulatory approvals in February 2025 and a period of organic product development, we have onboarded over 50 dealers and lending has commenced. This is a natural extension to our existing manufacturer and dealer relationships, allows us to fund the retail sales of our dealer customers and should unlock sales growth for them. Hire purchase and leasing, commonly known as asset finance, are typical lending products required by end-users to purchase our dealer's products and is in high demand by them. \n   \n Our newly launched platform is fully digital, designed for straight-through processing while still allowing for personalised, \"human touch\" engagement when needed. Purpose-built for scalability, with no legacy system constraints and full compliance with evolving regulatory and legal frameworks, our proposition and how we will go to market represents a clear point of differentiation from our competitors. \n   \n With an estimated addressable market within our existing dealer network of £10 billion per annum, the Group sees significant headroom for growth in this segment. Initial focus will be in the leisure sector, where the Group already carries a significant presence, with gradual expansion into other sectors. \n   \n Retail savings and funding strategy supports our growth ambitions \n   \n As at 30 June 2025, total deposits stood at £688 million (30 June 2024: £579 million, 31 December 2024: £650m), across approximately 15,500 accounts (30 June 2024: c. 14,600 accounts, December 2024: c15,600). \n   \n Our retail savings franchise remains a core strength of the Group and is fundamental to our funding strategy, enabling the continued growth and diversification of our balance sheet. \n   \n We remain visible and accessible to savers by featuring on \"Best Buy\" tables, supported by a super-fast application journey-enabling customers to open an account in minutes, with a dedicated sort code and account number issued immediately upon approval.  Our efforts have been recognised with multiple Feefo Platinum Trusted Service Awards (2024 and 2025), and we continue to achieve high customer satisfaction ratings for the quality and consistency of our service. \n   \n Widening the jaws between income generation and cost \n   \n Operationally, we remain focused on growing into our well-established cost base and operating model, maximising the benefits of our modern efficient digital banking platform. We are committed, in all of our lending products, to deliver a seamless and efficient service to customers, backed up by quality human interaction and relationship management where needed. Whilst total costs increased due to continued investment in our recently launched asset finance proposition and general inflationary pressures, cost discipline has been well maintained. Over time, we expect further operational leverage, enabling continued growth and a widening of the jaws between cost and income. Much of the cost relating to asset finance has been made in advance of revenues and loan book growth. \n   \n The Group's headcount reached 153 employees at the period end (30 June 2024: 132 employees) with total operating expenses for the half year of £15.1m (30 June 2024: £13.2m). The cost to income ratio stood at 57% (30 June 2024: 59%), in line with expectations. \n   \n Strong credit risk performance \n   \n Despite a persistently challenging macroeconomic backdrop and elevated interest rates, the Group's credit performance has remained exceptionally strong. This resilience reflects the high quality of our customer base and the effectiveness of our disciplined credit risk and portfolio management strategies. \n   \n The number of dealers in arrears continued at an extraordinarily low level, closing the period at 38 (30 June 2024: 20), representing just 2.5% of the total dealer base. In line with our prudent risk framework, we classify any account with payments one day or more overdue, as in arrears. As at 30 June 2025, 30 of these cases were in legal recovery, with appropriate credit loss provisions recognised based on expected recoveries. The Group's total arrears balance accounted for 0.9% of the loan book (30 June 2024: 0.5%). \n   \n The cost of risk for the period was 0.63%, demonstrating a consistent performance year over year once adjusting for the £1.7m RoyaleLife recovery in 2024 (30 June 2024: 0.61% adjusted Cost of Risk c ).  The strength of performance in this area reflects our proactive approach to credit risk management and our ability to mitigate dealer defaults through redistribution of products within our existing customer network or, where necessary, by the sale of secured assets to third parties. \n   \n \n \n \n \n \n \n \n 30 June 2025 \n \n \n 30 June 2024 \n \n \n 31 December 2024 \n \n \n \n \n \n \n \n £'000 \n \n \n £'000 \n \n \n £'000 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Arrears - principal repayment, fees and interest: \n \n \n   \n \n \n \n \n \n \n \n \n \n \n 1 - 30 days past due \n \n \n 285 \n \n \n                          427 \n \n \n 271 \n \n \n \n \n 31 - 60 days past due \n \n \n 130 \n \n \n                       576 \n \n \n 1,146 \n \n \n \n \n 61 - 90 days past due \n \n \n 944 \n \n \n                          474 \n \n \n 199 \n \n \n \n \n 91 + days past due \n \n \n 5,516 \n \n \n                     1,519 \n \n \n 2,646 \n \n \n \n \n   \n \n \n 6,875 \n \n \n                     2,992 \n \n \n 4,262 \n \n \n \n \n  Total % of loan book \n \n \n 0.9% \n \n \n 0.5% \n \n \n 0.6% \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Associated principal balance: \n \n \n   \n \n \n \n \n \n \n \n \n \n \n 1 - 30 days past due \n \n \n 1,056 \n \n \n                 2,587 \n \n \n 1,305 \n \n \n \n \n 31 - 60 days past due \n \n \n 377 \n \n \n                       1,200 \n \n \n 2,623 \n \n \n \n \n 61 - 90 days past due \n \n \n 4,144 \n \n \n                          439 \n \n \n 449 \n \n \n \n \n 91 + days past due \n \n \n 7,950 \n \n \n                     2,294 \n \n \n 3,912 \n \n \n \n \n   \n \n \n 13,527 \n \n \n                     6,520 \n \n \n 8,289 \n \n \n \n \n  Total % of loan book \n \n \n 1.8% \n \n \n 1.1% \n \n \n 1.2% \n \n \n \n \n   \n Portfolio ageing \n   \n We use average outstanding loan tenor as the most appropriate stock days measure to determine how our portfolio is ageing compared to our historical experience and our sector tolerance levels used for portfolio oversight. We have now seen a normalisation of seasonality trends, where typically there are high levels of repayments over the spring/summer \"selling\" season and reduced repayments during the autumn/winter \"re-stocking\" season. \n   \n Average stock days, which measure the average age of loans outstanding, have reduced to 128 days (31 December 2024: 145 days; 30 June 2024: 149 days), supporting our view of strong demand for dealer product on the forecourt . This provides a positive signal for any future credit issues. \n All sectors of the portfolio operate well within our tolerances. \n Strong underlying security position \n   \n In our core inventory finance lending product, we take legal title against individual assets to provide working capital to fund dealers' inventory or stock. The Group's lending relative to its security position continues to remain strong with a Loan to Wholesale Value ('LTV') of 86% (30 June 2024: 83%). We do not advance funds measured against retail prices, which typically represent a mark-up of approximately 20% on the wholesale invoice price. Accordingly, for the Group to incur losses on recovery of an asset in the event of default there would need to be an average reduction of approximately 30% in retail prices across the sectors and products we lend against. \n   \n c Adjusted Cost of Risk is an Alternative Performance Measures (\"APMs\") as defined in the APM section. \n   \n Successful Share-Buy Back Programme \n   \n During the period, the Bank successfully executed a share buy-back programme, reflecting the Board's confidence in the Group's financial strength, long-term strategy, and the intrinsic value of its shares. A total of 12,966,866 of ordinary shares were repurchased representing 7% of the share capital prior to the commencement of the share buyback. \n   \n Growth ambitions underpinned by a well-capitalised balance sheet \n   \n Whilst capital is not a current constraint to lending, with existing capital headroom, organic capital generation through good levels of profitability and Tier 2 capital facility to draw down, we will continue to diligently and ruthlessly ensure our capital is put to work where we can achieve the best risk-adjusted returns.  Across all capital instruments, the Group has current capacity to grow lending to c£950m, generating further Tier 1 capital with forward retained earnings. \n   \n As at 30 June 2025, the Bank's equity stood at £117.6m (30 June 2024: £107.6m). Regulatory capital, which is the Common Equity Tier 1 capital together with Tier 2 capital, increased to £111.9m (30 June 2024: £100.2m). This includes £10m drawn in 2023 under the £20m Tier 2 capital facility with British Business Investments. \n   \n Our participation in the British Business Bank's ENABLE Guarantee scheme, which was entered in 2023, currently stands at £350m. The Group's CET1 ratio ended the period at 19.7% (30 June 2024: 23.2%), well above our regulatory minimum. Our total Regulatory Capital (Common Equity Tier 1 Capital + Tier 2 Capital) as a % of risk weighted assets (\"RWAs\") ended the period at 21.7%, also well in excess of our regulatory minimum. \n   \n Outlook \n   \n We are at an exciting point in the Group's strategic journey, having more opportunities to support the needs of our customers than ever before. We continue to see potential in our core inventory finance to either grow market share with existing relationships or enter new sectors where serialised assets are held as stock. \n   \n Asset finance presents a material opportunity for further growth; the market is much larger than our core inventory finance product, with longer lending tenors that scale our loan book relatively quickly. We have crafted a proposition that is different to incumbents and expect demand for this will grow over time. \n   \n Whilst these two lending channels will substantively represent our loan book over the medium term, our growth plan is ably complemented by tailored lending solutions that help grow our markets, unlocking the ambitions of sector participants through our lending expertise. These significant growth opportunities, our financial performance to date, and our more favourable view of net interest margin, underpins our confidence for the year, with the Board now expecting performance to materially exceed market expectations for the full year. We also remain firmly on track to hit our medium-term financial goals of: \n   \n \n \n \n \n ● \n \n \n Target loan book of c.£1.3bn by the end of FY28 \n \n \n \n \n ● \n \n \n Continuation of strong NIM over the medium term; we have revised our guidance of NIM over the medium term to c7% in the core inventory finance product versus 6% previously \n \n \n \n \n ● \n \n \n Continued cost efficiency with scale, achieving <50% cost to income ratio by FY28 \n \n \n \n \n ● \n \n \n Progression of return on equity with a mid-teens target for FY28 \n \n \n \n \n ● \n \n \n No further Tier 1 equity capital required to deliver these medium-term financial targets \n \n \n \n \n   \n Whilst always cautious and vigilant about the uncertainties presented by the macroeconomic and political environment, I'm excited about our future plans. \n   \n   \n Carl D'Ammassa \n Chief Executive Officer \n   \n   \n Financial Highlights and Key Performance Indicators \n   \n Summarised Statement of Comprehensive Income \n \n \n \n \n \n \n \n 30 June 2025 \n \n \n 30 June 2024 \n \n \n 31 December 2024 \n \n \n \n \n   \n \n \n 6-month \n \n \n 6-month \n \n \n 12-month \n \n \n \n \n \n \n \n £'000 \n \n \n £'000 \n \n \n £'000 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Gross revenues 1 \n \n \n                     43,254 \n \n \n                     37,889 \n \n \n                     76,805 \n \n \n \n \n Interest expense \n \n \n                   (16,942) \n \n \n  (15,383) \n \n \n  (31,208) \n \n \n \n \n Net income \n \n \n                     26,312 \n \n \n 22,506 \n \n \n 45,597 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Other operating expenses \n \n \n (15,087) \n \n \n  (13,226) \n \n \n  (26,764) \n \n \n \n \n Impairment charges \n \n \n (2,187) \n \n \n  (106) \n \n \n 241 \n \n \n \n \n Profit before taxation \n \n \n 9,038 \n \n \n                       9,174 \n \n \n 19,074 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Taxation \n \n \n (2,432) \n \n \n  (2,443) \n \n \n  (5,053) \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Profit after taxation \n \n \n 6,606 \n \n \n 6,731 \n \n \n 14,021 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Other comprehensive income/(loss) \n \n \n                                - \n \n \n 74 \n \n \n 75 \n \n \n \n \n Total comprehensive income for the period \n \n \n                        6,606 \n \n \n 6,805 \n \n \n 14,096 \n \n \n \n \n Basic earnings per share (pence) \n \n \n 3.7p \n \n \n 3.8p \n \n \n 7.8p \n \n \n \n \n 1 Sum of interest and similar income, fee income less fee expenses, net gains/(losses) from derivatives measured at fair value through profit or loss and other operating income \n   \n Summarised Statement of Financial Position \n \n \n \n \n \n \n \n 30 June 2025 \n \n \n 30 June 2024 \n \n \n 31 December 2024 \n \n \n \n \n \n \n \n £'000 \n \n \n £'000 \n \n \n £'000 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Cash and balances at central banks \n \n \n                     84,856 \n \n \n                     86,036 \n \n \n                   110,030 \n \n \n \n \n Loans and advances to banks \n \n \n                     11,599 \n \n \n                        3,496 \n \n \n                        3,771 \n \n \n \n \n Investment securities \n \n \n                               - \n \n \n                        6,175 \n \n \n                           769 \n \n \n \n \n Loans and advances to customers \n \n \n 722,031 \n \n \n                   596,771 \n \n \n                   660,772 \n \n \n \n \n Taxation asset \n \n \n 2,110 \n \n \n                        5,265 \n \n \n                        3,980 \n \n \n \n \n Other assets \n \n \n 11,388 \n \n \n                        8,462 \n \n \n                        7,218 \n \n \n \n \n Total assets \n \n \n 831,984 \n \n \n                   706,205 \n \n \n                   786,540 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Customer deposits \n \n \n                   688,128 \n \n \n                   579,012 \n \n \n                   649,665 \n \n \n \n \n Financial liabilities \n \n \n                        2,643 \n \n \n                        1,127 \n \n \n                             90 \n \n \n \n \n Subordinated liabilities \n \n \n                     10,234 \n \n \n                     10,225 \n \n \n                     10,230 \n \n \n \n \n Taxation liabilities \n \n \n                           189 \n \n \n                           670 \n \n \n                        1,259 \n \n \n \n \n Other liabilities \n \n \n                     13,165 \n \n \n                        7,598 \n \n \n                        9,942 \n \n \n \n \n Total liabilities \n \n \n 714,359 \n \n \n                   598,632 \n \n \n                   671,186 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Total equity \n \n \n 117,625 \n \n \n                   107,573 \n \n \n                   115,354 \n \n \n \n \n Adjusted tangible net asset value per share (pence) \n \n \n 70.2p \n \n \n 59.6p \n \n \n 63.8p \n \n \n \n \n   \n   \n   \n   \n \n \n \n \n   \n \n \n 30 June 2025 \n \n \n 30 June 2024 \n \n \n 31 December 2024 \n \n \n \n \n \n \n \n 6-month \n \n \n 6-month \n \n \n 12-month \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Financial Highlights \n \n \n \n \n \n \n \n \n \n \n \n \n \n Gross revenues (£m) 1 \n \n \n                         43.3 \n \n \n                         37.9 \n \n \n                         76.8 \n \n \n \n \n Adjusted profit before taxation (£m) 2 \n \n \n                           9.0 \n \n \n                           7.5 \n \n \n                         14.4 \n \n \n \n \n Adjusted profit after taxation (£m) 3 \n \n \n                           6.6 \n \n \n                           5.4 \n \n \n                         10.5 \n \n \n \n \n Gross loan book (£m) 4 \n \n \n                          728 \n \n \n 603 \n \n \n                          666 \n \n \n \n \n Net assets (£m) 5 \n \n \n                       117.6 \n \n \n                       107.6 \n \n \n                       115.4 \n \n \n \n \n Customer deposits (£m) \n \n \n                          688 \n \n \n                          579 \n \n \n                          650 \n \n \n \n \n Regulatory capital (£m) 6 \n \n \n 112 \n \n \n 100 \n \n \n                       109 \n \n \n \n \n Common Equity Tier 1 capital ratio 7 \n \n \n 19.7% \n \n \n 23.2% \n \n \n 21.6% \n \n \n \n \n Regulatory capital (as a % of RWA) 8 \n \n \n 21.7% \n \n \n 25.9% \n \n \n 23.8% \n \n \n \n \n Gross yield 9 \n \n \n 12.2% \n \n \n 12.1% \n \n \n 12.2% \n \n \n \n \n Net interest margin 10 \n \n \n 7.9% \n \n \n 7.8% \n \n \n 7.9% \n \n \n \n \n Average customer rate for retail deposits 11 \n \n \n 4.80% \n \n \n 5.10% \n \n \n 5.16% \n \n \n \n \n Adjusted cost of risk 12 \n \n \n 0.63% \n \n \n 0.61% \n \n \n 0.75% \n \n \n \n \n Impairment loss coverage on loans to customers 13 \n \n \n 1.06% \n \n \n 1.32% \n \n \n 0.98% \n \n \n \n \n Cost to income ratio 14 \n \n \n 57% \n \n \n 59% \n \n \n 59% \n \n \n \n \n Adjusted basic earnings per share (pence) 15 \n \n \n                           3.8 \n \n \n                           3.0 \n \n \n                           5.9 \n \n \n \n \n Adjusted tangible net assets per share 16 \n \n \n                         70.2 \n \n \n                         59.6 \n \n \n                         63.8 \n \n \n \n \n Key Performance Indicators \n \n \n \n \n \n \n \n \n \n \n \n \n \n Loans advanced to customers (£m) \n \n \n 828 \n \n \n 710  \n \n \n 1,440 \n \n \n \n \n Number of dealer customers 17 \n \n \n 1,491 \n \n \n 1,250 \n \n \n 1,334 \n \n \n \n \n Number of manufacturer partners 18 \n \n \n 97 \n \n \n 90  \n \n \n                             88 \n \n \n \n \n Total credit available to dealers (£m) 19 \n \n \n 1,390 \n \n \n 1,088  \n \n \n 1,142 \n \n \n \n \n 1 Sum of interest and similar income, fee income less fee expenses, net gains/(losses) from derivatives measured at fair value through profit or loss and other operating income \n 2 Profit before tax adjusted for the RoyaleLife write-back in 2024. No adjustment was required for 2025. \n 3 Profit after tax adjusted for the RoyaleLife write-back in 2024. No adjustment was required for 2025. \n 4 Principal balance outstanding for loans and advances to customers \n 5 The equity held in the Group \n 6 Regulatory capital is the Common Equity Tier 1 capital (which includes current year profit) together with Tier 2 capital \n 7 Common Equity Tier 1 capital (which includes current year profit) divided by Risk Weighted Assets \n 8 Regulatory capital divided by Risk Weighted Assets \n 9 The effective interest rate we charge our customers comprising interest income including fees \n 10 Total operating income adding back fee expense as a % of average gross receivables \n 11 The weighted average interest rate we pay our depositors \n 12 Impairment charges and recoveries and provisions in the period (annualised) as a % of average gross receivables. 2024 periods have been adjusted for the RoyaleLife write-back. No adjustment was required for 2025. \n 13 Impairment allowance as a % of gross receivables at the period end \n 14 Operating cost as a % of total operating income \n 15 Adjusted profit after tax divided by the weighted average number of shares in issue excluding treasury shares \n 16 Net assets less intangible assets divided by the weighted average number of shares in issue excluding treasury shares. No adjustment was required for 2024. \n 17 Number of borrower relationships \n 18 Number of vendors and manufacturers with whom we have programs that support our lending \n 19 Amount of credit available to our customers to draw (uncommitted) including existing drawings \n   \n Alternative Performance Measures \n   \n Certain financial measures disclosed in the Interim Financial Report do not have a standardised meaning prescribed by International Financial Reporting Standards (IFRS) and may therefore not be comparable to similar measures presented by other issuers. Gross revenues and net interest margin are deemed to be Alternative Performance Measures (\"APMs\") and are defined in the Appendix. \n APMs may be considered in addition to, but not as a substitute for, the reported IFRS results. The Group believes that these APMs together with the other metrics presented above, when considered together with reported IFRS results, provide stakeholders with additional information to better understand the Group's financial performance. \n Based on the Group's strategy and business model, there are six principal risk categories used to help shape our policy and control framework. This categorisation creates structure for the risk policy framework and clear ownership/responsibility for assessing risk performance. \n There are certain risk themes that run across many or all of these risk types. We have chosen at this stage to not pull them out individually, but instead to manage them across the principal risks framework. A good example of this are the risks created by climate change. Whilst these risks may crystallise in full over longer-time horizons, they are already becoming apparent in our business operations and cut across more than one of the principal risk categories below. \n   \n Principal Risks \n   \n \n \n \n \n Principal Risks \n \n \n   \n \n \n   \n \n \n \n \n Operational risk \n \n \n Operational risk is defined as the risk of loss resulting from inadequate or failed internal processes, people and systems, or from external events. We have a framework in place which sets out our approach to Operational Risk, with associated roles and responsibilities further defined in a number of risk policies and standard operating procedures covering the various types of Operational Risk. Although the overall scope of Operational Risk would cover areas of Conduct and Compliance (i.e. regulatory) risks, we believe it makes sense to separate these items out as individual principal risks - Conduct Risk and Compliance Risk respectively given the importance of these risks in the context of the bank's activities and regulatory environment. \n \n \n Key risk mitigation tools: operational risk policies, standard operating procedures, Risk and Control Self Assessments (\"RCSAs\"), risk event analysis, key controls testing, ongoing monitoring of risk metrics and limits, scenario analysis, information security and cyber defences, operational risk training, operational risk training, change management framework, operational resilience framework, physical security and safety, regular risk training, Group Risk Committee oversight. \n   \n \n \n \n \n Compliance Risk \n \n \n Compliance risk is the risk of legal or regulatory sanctions, material financial loss, or loss to reputation the firm may suffer as a result of its failure to comply with laws, regulations, rules, related self-regulatory organisation standards, and codes of conduct applicable to its activities. DF Capital operates within the context of the UK legal and regulatory environment. Our Compliance Framework sets out the responsibilities within the firm to ensure awareness of both current and upcoming legal and regulatory changes and how the firm plans and implements those requirements appropriately. Compliance risk also includes the Group's obligations under the Money Laundering Regulations and covers the Groups exposure to customer-specific risk assessments, compliance monitoring plan, ongoing monitoring of risk metrics and limits, customer risk assessments, regulatory compliance training, Executive Risk Committee oversight. \n   \n   \n \n \n Key risk mitigation tools: compliance policies, regulatory monitor, enterprise-wide compliance and customer-specific risk assessments, compliance monitoring plan, ongoing monitoring of risk metrics and limits, customer risk assessments, regulatory compliance training, Group Risk Committee oversight. \n   \n \n \n \n \n Conduct Risk \n \n \n We define conduct risk as the risk of detriment caused to DF Capital's customers or financial markets due to inappropriate execution of its business activities and processes, including the sale of unsuitable products and inappropriate behaviours. The Conduct Risk Framework outlines our approach for ensuring good customer outcomes in line with the New Consumer Duty. It is supported by specific policies covering topics such as product governance, complaints, and vulnerable customers, which detail the specific steps and responsibilities across the firm. The scope of conduct risk coverage includes our AIM requirements, with policies such as a Market Abuse Regime Policy (including Share Dealing Code) and a Substantial and Related Party Transactions Policy. \n   \n \n \n Key risk mitigation tools: conduct risk policies, product governance, enterprise- wide conduct risk assessment, ongoing monitoring of risk metrics and limits, monitoring of complaints and customer feedback, key controls testing, Code of Ethics, conduct risk training and Group Risk Committee oversight. \n \n \n \n \n Prudential Risk \n \n \n Prudential risk covers three financial risks relating to the bank maintaining sufficient resources to ensure it is financially resilient: \n ·      Funding and liquidity risk: The risk that DF Capital is not able to meet its financial obligations as they fall due or that it does not have the tenor and composition of funding and liquidity to support its assets. \n ·      Capital risk: The risk that DF Capital has an insufficient amount or quality of capital to support the regulatory requirements of its business activities through normal and stressed conditions. \n   \n ·      Market risk (including interest rate risk): The risk of financial loss through un-hedged or mismatched asset and liability positions due to interest rate changes. This also includes the risk that assets and liabilities reference different interest rate bases and the risk of adverse financial impact from movements in market prices in the value of assets and liabilities. \n   \n Roles, responsibilities, and requirements for Liquidity and Capital management are outlined in the Treasury Policy, with risk appetite taking into account the results of the bank's ILAAP and ICAAP. The Treasury Policy also outlines the roles and responsibilities required for identifying, measuring, monitoring and controlling any interest rate risk which arises due to the mismatch between assets and liabilities. \n   \n \n \n Key risk mitigation tools: treasury policies, ICAAP, ILAAP, funds transfer pricing policy, additional stress testing, ongoing monitoring of risk metrics and limits, financial planning and forecasting, monitoring of external environment, Asset & Liability Committee and Group Risk Committee oversight. \n \n \n \n \n Credit Risk \n \n \n Credit risk is the risk of financial loss arising from a customer or counterparty failing to meet their financial obligations to DF Capital. Credit risk is considered the most significant risk faced by DF Capital and can be broken down into the following categories: \n   \n ·      Client Default Risk: The risk of loss arising from a failure of a borrower to meet their obligations under a credit agreement. \n ·      Credit Concentration Risk: The risk of loss due to the concentration of credit risk to a specific customer, counterparty, geography, or industry. \n ·      Repurchase Risk: The risk of loss arising from the failure of a third-party to meet a claim under a repurchase agreement. \n ·      Security Risk: The risk that an asset used as security to mitigate a credit loss does not provide the protection to the Company that is expected, leading to unanticipated losses. \n ·      Counterparty Risk: The failure of a Group counterparty or derivative provider. \n   \n A credit framework and policies are in place to manage DF Capital's credit risk exposure, covering the roles and responsibilities of the Group's lending and investment activities. \n   \n \n \n Key risk mitigation tools: C redit underwriting criteria, asset audits, sector deep-dive reviews, portfolio monitoring, ongoing monitoring of risk metrics and limits, hindsight reviews of default events, monitoring of external environment, Credit Committee and Group Risk Committee oversight. \n   \n \n \n \n \n Strategic Risk \n \n \n Strategic risks are the risks which can adversely impact the ability of DF Capital in achieving its strategic objectives. These risks may impact shareholder value, earnings or growth from poor strategic decisions, improper implementation of business strategies or from external events. \n   \n The level 2 principal risks which fall under this category include: \n   \n ·      Strategic Planning Risk: The risk of strategic plans being unachievable or unrealistic. \n ·      Execution Risk: The risk of failing to execute the Group's strategy and failing to deliver key strategic initiatives required to meet the financial and commercial targets of the Group. \n ·      Strategic Projects Risk: The risk of delay or failure of strategic projects and programmes. \n ·      External Environment: The risk of failing to address the impact of external events and competitive threats. \n   \n Strategic risks are considered as part of DF Capital's strategic and financial plans. Stress scenarios are modelled as part of the ICAAP and ILAAP to determine what level of capital and liquidity the Group will need to hold in support of its strategic and financial plans. \n \n \n Key risk mitigation tools: Executive Committee and Board oversight, comprehensive risk assessments of strategic and financial plans, stress testing, horizon scanning, ongoing monitoring of macro and microeconomic environment, change management framework. \n \n \n \n \n   \n   \n Statement of Directors' Responsibilities \n   \n We, the Directors, confirm that to the best of our knowledge: \n   \n \n \n \n \n ● \n \n \n the interim condensed consolidated financial statements have been prepared in accordance with IAS 34 'Interim Financial Reporting' as adopted by the United Kingdom (UK); \n \n \n \n \n ● \n \n \n the interim report includes a fair review of the performance of the business and the position of the Group and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face; and \n \n \n \n \n ● \n \n \n the interim report and financial statements, taken as a whole, are fair, balanced and understandable. \n \n \n \n \n   \n   \n   \n   \n By order of the Board \n   \n   \n   \n …………………………… \n Carl D'Ammassa \n Director \n 10 September 2025 \n   \n Independent Review Report to Distribution Finance Capital Holdings plc \n   \n   \n Conclusion \n   \n We have been engaged by the company to review the condensed set of financial statements in the half-yearly financial report for the six months ended 30 June 2025 which comprises the condensed consolidated statement of comprehensive income, the condensed consolidated statement of financial position, the condensed consolidated statement of changes in equity, the condensed consolidated cashflow statement and related notes 1 to 30. \n   \n Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 30 June 2025 is not prepared, in all material respects, in accordance with United Kingdom adopted International Accounting Standard 34 and the AIM Rules of the London Stock Exchange . \n   \n Basis for Conclusion  \n   \n We conducted our review in accordance with International Standard on Review Engagements (UK) 2410 \"Review of Interim Financial Information Performed by the Independent Auditor of the Entity\" issued by the Financial Reporting Council for use in the United Kingdom (ISRE (UK) 2410). A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion. \n   \n As disclosed in note 1, the annual financial statements of the group are prepared in accordance with United Kingdom adopted international accounting standards. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with United Kingdom adopted International Accounting Standard 34, \"Interim Financial Reporting\" . \n   \n Conclusion Relating to Going Concern \n   \n Based on our review procedures, which are less extensive than those performed in an audit as described in the Basis for Conclusion section of this report, nothing has come to our attention to suggest that the directors have inappropriately adopted the going concern basis of accounting or that the directors have identified material uncertainties relating to going concern that are not appropriately disclosed. \n   \n This conclusion is based on the review procedures performed in accordance with ISRE (UK) 2410; however future events or conditions may cause the entity to cease to continue as a going concern . \n   \n Responsibilities of the directors \n   \n The directors are responsible for preparing the half-yearly financial report in accordance with the AIM rules of the London Stock Exchange. \n   \n In preparing the half-yearly financial report, the directors are responsible for assessing the group's ability to continue as a going concern, disclosing as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so . \n   \n Auditor's Responsibilities for the review of the financial information \n   \n In reviewing the half-yearly financial report, we are responsible for expressing to the company a conclusion on the condensed set of financial statements in the half-yearly financial report. Our conclusion, including our conclusion relating to going concern, are based on procedures that are less extensive than audit procedures, as described in the Basis for Conclusion paragraph of this report . \n   \n Use of our report \n   \n This report is made solely to the company in accordance with ISRE (UK) 2410. Our work has been undertaken so that we might state to the company those matters we are required to state to it in an independent review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company, for our review work, for this report, or for the conclusions we have formed . \n   \n   \n   \n Deloitte LLP \n Statutory Auditor \n Manchester, United Kingdom \n 10 September 2025 \n   \n Condensed Consolidated Statement of Comprehensive Income \n   \n \n \n \n \n \n \n \n \n \n \n 6 months \n \n \n 6 months \n \n \n Year ended \n \n \n \n \n   \n \n \n \n \n \n ended \n \n \n ended \n \n \n 31 December \n \n \n \n \n   \n \n \n \n \n \n 30 June 2025 \n \n \n 30 June 2024 \n \n \n 2024 \n \n \n \n \n   \n \n \n \n \n \n (Unaudited) \n \n \n (Unaudited) \n \n \n (Audited) \n \n \n \n \n \n \n \n Note \n \n \n £'000 \n \n \n £'000 \n \n \n £'000 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Interest and similar income \n \n \n 5 \n \n \n 43,937 \n \n \n 37,657 \n \n \n 76,820 \n \n \n \n \n Interest and similar expenses \n \n \n 6 \n \n \n  (16,942) \n \n \n  (15,383) \n \n \n  (31,208) \n \n \n \n \n Net interest income \n \n \n   \n \n \n 26,995 \n \n \n 22,274 \n \n \n 45,612 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Fee income \n \n \n 7 \n \n \n 607 \n \n \n 695 \n \n \n 1,237 \n \n \n \n \n Fee expenses \n \n \n 8 \n \n \n  (796) \n \n \n  (688) \n \n \n  (1,626) \n \n \n \n \n Gains/(losses) on derivatives at fair value through profit or loss \n \n \n \n \n \n  (519) \n \n \n 225 \n \n \n 372 \n \n \n \n \n Other income \n \n \n \n \n \n 25 \n \n \n - \n \n \n 2 \n \n \n \n \n Total operating income \n \n \n   \n \n \n 26,312 \n \n \n 22,506 \n \n \n 45,597 \n \n \n \n \n   \n \n \n   \n \n \n   \n \n \n   \n \n \n   \n \n \n \n \n Staff costs \n \n \n 9 \n \n \n  (9,499) \n \n \n  (7,823) \n \n \n  (16,044) \n \n \n \n \n Other operating expenses \n \n \n 10 \n \n \n  (5,588) \n \n \n  (5,403) \n \n \n  (10,670) \n \n \n \n \n Net impairment (loss)/gain on financial assets \n \n \n 12 \n \n \n  (2,187) \n \n \n  (106) \n \n \n 241 \n \n \n \n \n Other provisions \n \n \n \n \n \n - \n \n \n - \n \n \n  (50) \n \n \n \n \n Total operating profit \n \n \n   \n \n \n 9,038 \n \n \n 9,174 \n \n \n 19,074 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Profit before taxation \n \n \n   \n \n \n 9,038 \n \n \n 9,174 \n \n \n 19,074 \n \n \n \n \n Taxation charge \n \n \n 13 \n \n \n  (2,432) \n \n \n  (2,443) \n \n \n  (5,053) \n \n \n \n \n Profit after taxation \n \n \n   \n \n \n 6,606 \n \n \n 6,731 \n \n \n 14,021 \n \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Other comprehensive income/(loss): \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Items that may subsequently be transferred to the income statement: \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n FVOCI investment securities: \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Amounts transferred to the income statement \n \n \n \n \n \n - \n \n \n                               - \n \n \n 75 \n \n \n \n \n Fair value movements \n \n \n \n \n \n - \n \n \n 74 \n \n \n - \n \n \n \n \n Total other comprehensive income for the period, net of tax \n \n \n   \n \n \n - \n \n \n 74 \n \n \n 75 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Total comprehensive income for the period \n \n \n   \n \n \n 6,606 \n \n \n 6,805 \n \n \n 14,096 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Earnings per share: \n \n \n   \n \n \n pence \n \n \n pence \n \n \n Pence \n \n \n \n \n Basic EPS \n \n \n 28 \n \n \n 3.7 \n \n \n 3.8 \n \n \n 7.8 \n \n \n \n \n Diluted EPS \n \n \n 28 \n \n \n 3.5 \n \n \n 3.6 \n \n \n 7.4 \n \n \n \n \n   \n   \n Condensed Consolidated Statement of Financial Position \n   \n \n \n \n \n \n \n \n \n \n \n 30 June 2025 \n \n \n 30 June 2024 \n \n \n 31 December 2024 \n \n \n \n \n   \n \n \n \n \n \n (Unaudited) \n \n \n (Unaudited) \n \n \n (Audited) \n \n \n \n \n \n \n \n Note \n \n \n £'000 \n \n \n £'000 \n \n \n £'000 \n \n \n \n \n Assets: \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Cash and balances at central banks \n \n \n 84,856 \n \n \n 86,036 \n \n \n  110,030 \n \n \n \n \n Loans and advances to banks \n \n \n 11,599 \n \n \n 3,496 \n \n \n  3,771 \n \n \n \n \n Investment securities \n \n \n 25 \n \n \n - \n \n \n 6,175 \n \n \n 769 \n \n \n \n \n Derivatives held for risk management \n \n \n \n \n \n 306 \n \n \n 210 \n \n \n 295 \n \n \n \n \n Loans and advances to customers \n \n \n 14 \n \n \n 722,031 \n \n \n 596,771 \n \n \n 660,772 \n \n \n \n \n Trade and other receivables \n \n \n 15 \n \n \n 6,486 \n \n \n 5,126 \n \n \n 4,678 \n \n \n \n \n Deferred taxation asset \n \n \n 18 \n \n \n  2,110 \n \n \n  5,265 \n \n \n  3,980 \n \n \n \n \n Non-current assets held for sale \n \n \n - \n \n \n  50 \n \n \n  - \n \n \n \n \n Property, plant and equipment \n \n \n 1,026 \n \n \n  1,303 \n \n \n  1,093 \n \n \n \n \n Right-of-use assets \n \n \n 19 \n \n \n  2,744 \n \n \n  1,141 \n \n \n  202 \n \n \n \n \n Intangible assets \n \n \n \n \n \n  826 \n \n \n  632 \n \n \n  950 \n \n \n \n \n Total assets \n \n \n   \n \n \n  831,984 \n \n \n  706,205 \n \n \n  786,540 \n \n \n \n \n   \n \n \n   \n \n \n   \n \n \n   \n \n \n   \n \n \n \n \n Liabilities: \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Customer deposits \n \n \n 22 \n \n \n 688,128 \n \n \n 579,012 \n \n \n 649,665 \n \n \n \n \n Amounts due to banks \n \n \n \n \n \n - \n \n \n 180 \n \n \n 180 \n \n \n \n \n Derivatives held for risk management \n \n \n \n \n \n 495 \n \n \n 65 \n \n \n 6 \n \n \n \n \n Fair value adjustments on hedged liabilities \n \n \n 26 \n \n \n 287 \n \n \n 182 \n \n \n 136 \n \n \n \n \n Lease liabilities \n \n \n 23 \n \n \n 2,643 \n \n \n 1,127 \n \n \n 90 \n \n \n \n \n Trade and other payables \n \n \n \n \n \n 11,961 \n \n \n 7,101 \n \n \n 9,335 \n \n \n \n \n Provisions \n \n \n 11 \n \n \n 422 \n \n \n 70 \n \n \n 285 \n \n \n \n \n Current taxation liability \n \n \n 17 \n \n \n 189 \n \n \n 670 \n \n \n 1,259 \n \n \n \n \n Subordinated liabilities \n \n \n 24 \n \n \n 10,234 \n \n \n 10,225 \n \n \n 10,230 \n \n \n \n \n Total liabilities \n \n \n   \n \n \n 714,359 \n \n \n 598,632 \n \n \n 671,186 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Equity: \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Issued share capital \n \n \n 21 \n \n \n 1,793 \n \n \n 1,793 \n \n \n 1,793 \n \n \n \n \n Merger relief \n \n \n 21 \n \n \n 94,911 \n \n \n 94,911 \n \n \n 94,911 \n \n \n \n \n Merger reserve \n \n \n \n \n \n  (20,609) \n \n \n  (20,609) \n \n \n  (20,609) \n \n \n \n \n Own shares \n \n \n 21 \n \n \n  (473) \n \n \n  (439) \n \n \n  (440) \n \n \n \n \n Retained earnings \n \n \n \n \n \n 46,880 \n \n \n 31,917 \n \n \n 39,699 \n \n \n \n \n Treasury Shares \n \n \n 21 \n \n \n  (4,877) \n \n \n - \n \n \n - \n \n \n \n \n Total equity \n \n \n   \n \n \n 117,625 \n \n \n 107,573 \n \n \n 115,354 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Total equity and liabilities \n \n \n 831,984 \n \n \n 706,205 \n \n \n 786,540 \n \n \n \n \n   \n Condensed Consolidated Statement of Changes in Equity \n   \n \n \n \n \n \n \n \n Issued share capital \n \n \n Merger relief \n \n \n Merger reserve \n \n \n Own shares 1 \n \n \n Treasury Shares 2 \n   \n \n \n Retained earnings/(loss) \n \n \n   \n   \n Total \n \n \n \n \n   \n \n \n £'000 \n \n \n £'000 \n \n \n £'000 \n \n \n £'000 \n \n \n £'000 \n \n \n £'000 \n \n \n £'000 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Balance at 31 December 2023 (Audited) \n \n \n  1,793 \n \n \n  94,911 \n \n \n  (20,609) \n \n \n  (401) \n \n \n  - \n \n \n  24,720 \n \n \n  100,414 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Profit after taxation \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  6,731 \n \n \n  6,731 \n \n \n \n \n Other comprehensive loss \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  74 \n \n \n  74 \n \n \n \n \n Share-based payments \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n - \n \n \n  - \n \n \n  493 \n \n \n  493 \n \n \n \n \n Share premium account cancellation \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  (38) \n \n \n  - \n \n \n  (101) \n \n \n  (139) \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Balance at 30 June 2024 (Unaudited) \n \n \n  1,793 \n \n \n  94,911 \n \n \n  (20,609) \n \n \n  (439) \n \n \n  - \n \n \n  31,917 \n \n \n  107,573 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Profit after taxation \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  7,290 \n \n \n  7,290 \n \n \n \n \n Other comprehensive loss \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  1 \n \n \n  1 \n \n \n \n \n Share-based payments \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  492 \n \n \n  492 \n \n \n \n \n Employee Benefit Trust \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  (1) \n \n \n  - \n \n \n  (1) \n \n \n  (2) \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Balance at 31 December 2024 (Audited) \n \n \n  1,793 \n \n \n  94,911 \n \n \n  (20,609) \n \n \n  (440) \n \n \n  - \n \n \n  39,699 \n \n \n  115,354 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Profit after taxation \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  6,606 \n \n \n  6,606 \n \n \n \n \n Share-based payments \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  614 \n \n \n  614 \n \n \n \n \n Employee Benefit Trust \n \n \n  - \n \n \n  - \n \n \n  - \n \n \n  (33) \n \n \n  - \n \n \n  (39) \n \n \n  (72) \n \n \n \n \n Share buyback \n \n \n - \n \n \n - \n \n \n - \n \n \n - \n \n \n  (4,877) \n \n \n - \n \n \n  (4,877) \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Balance at 30 June 2025 (Unaudited) \n \n \n  1,793 \n \n \n  94,911 \n \n \n  (20,609) \n \n \n  (473) \n \n \n  (4,877) \n \n \n  46,880 \n \n \n  117,625 \n \n \n \n \n   \n   \n 1 The Group has adopted look-through accounting (see note 1 of the 2024 Annual Report and Accounts) and recognised the Employee Benefit Trust (EBT) within the consolidated financial statements. \n   \n 2 During the period, the Group repurchased 12,966,866 shares at a total cost of £4,876,862 inclusive of commission. These treasury shares do not carry voting rights or rights to dividends while held by the company. \n   \n Condensed Consolidated Cash Flow Statement \n   \n \n \n \n \n \n \n \n \n \n \n 30 June 2025 \n \n \n 30 June 2024 \n \n \n 31 December 2024 \n \n \n \n \n   \n \n \n \n \n \n (Unaudited) \n \n \n (Unaudited) \n \n \n (Audited) \n \n \n \n \n \n \n \n Note \n \n \n £'000 \n \n \n £'000 \n \n \n £'000 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Cash flows from operating activities: \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Profit before taxation \n \n \n \n \n \n 9,038 \n \n \n 9,174 \n \n \n 19,074 \n \n \n \n \n Adjustments for non-cash items and other adjustments \n Included in the income statement \n \n \n 20 \n \n \n 4,788 \n \n \n 1,948 \n \n \n 3,822 \n \n \n \n \n Increase in operating assets \n \n \n 20 \n \n \n  (65,630) \n \n \n  (28,693) \n \n \n  (92,390) \n \n \n \n \n Increase in operating liabilities \n \n \n 20 \n \n \n 41,532 \n \n \n 6,654 \n \n \n 79,376 \n \n \n \n \n Taxation (paid)/received \n \n \n \n \n \n  (1,631) \n \n \n 55 \n \n \n  (681) \n \n \n \n \n Net cash (used in)/generated from operating activities \n \n \n   \n \n \n  (11,903) \n \n \n  (10,862) \n \n \n 9,201 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Cash flows from investing activities: \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Purchase of investment securities \n \n \n \n \n \n - \n \n \n  (4,936) \n \n \n  (9,918) \n \n \n \n \n Proceeds from sale and maturity of investment securities \n \n \n \n \n \n - \n \n \n 15,000 \n \n \n 25,000 \n \n \n \n \n Dividend income on money market fund \n \n \n \n \n \n 21 \n \n \n 3 \n \n \n 25 \n \n \n \n \n Coupon received from investment securities \n \n \n 25 \n \n \n - \n \n \n 75 \n \n \n 75 \n \n \n \n \n Purchase of property, plant and equipment \n \n \n \n \n \n  (570) \n \n \n  (364) \n \n \n  (397) \n \n \n \n \n Purchase of right of use assets \n \n \n \n \n \n  (87) \n \n \n - \n \n \n - \n \n \n \n \n Purchase of intangible assets \n \n \n \n \n \n  (9) \n \n \n  (166) \n \n \n  (623) \n \n \n \n \n Net cash (used in)/generated from investing activities \n \n \n   \n \n \n  (645) \n \n \n 9,612 \n \n \n 14,162 \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Cash flows from financing activities: \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Repayment of lease liabilities \n \n \n 23 \n \n \n  (108) \n \n \n  (130) \n \n \n  (252) \n \n \n \n \n Coupon paid on subordinated liabilities \n \n \n \n \n \n  (630) \n \n \n  (634) \n \n \n  (1,273) \n \n \n \n \n Purchase of own shares \n \n \n \n \n \n  (72) \n \n \n  (138) \n \n \n  (142) \n \n \n \n \n Purchase of treasury shares \n \n \n 21 \n \n \n  (4,877) \n \n \n - \n \n \n - \n \n \n \n \n Net cash used in financing activities \n \n \n   \n \n \n  (5,687) \n \n \n  (902) \n \n \n  (1,667) \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Net (decrease)/increase in cash and cash equivalents \n \n \n   \n \n \n  (18,235) \n \n \n  (2,152) \n \n \n 21,696 \n \n \n \n \n Cash and cash equivalents at start of the period \n \n \n \n \n \n 112,563 \n \n \n 90,867 \n \n \n 90,867 \n \n \n \n \n Cash and cash equivalents at end of the period \n \n \n   \n \n \n 94,328 \n \n \n 88,715 \n \n \n 112,563 \n \n \n \n \n   \n Notes to the Interim Financial Report \n   \n 1. Basis of preparation \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n 1.1 General information \n The interim condensed consolidated financial statements of Distribution Finance Capital Holdings plc (the \"Company\" or \"DFCH plc\") include the assets, liabilities and results of its wholly owned subsidiaries, DF Capital Bank Limited (\"the Bank\"), DF Capital Financial Solutions Limited and DF Capital Retail Finance Limited, which together form the \"Group\". \n   \n DFCH plc is registered and incorporated in England and Wales under company registration number 11911574. The registered office is St James' Building, 61-95 Oxford Street, Manchester, M1 6EJ. The Company's ordinary shares are admitted to trading on AIM, a market operated by the London Stock Exchange. \n   \n The principal activity of the Company is that of an investment holding company. The principal activity of the Group is as a specialist personal savings and commercial lending bank group. The Group provides niche working capital funding solutions to dealers and manufacturers, enabled by competitively priced personal savings products. \n                                                                                                                                                                                \n The interim report is presented in pounds sterling, which is the currency of the primary economic environment in which the Group operates, and are rounded to the nearest thousand pounds, unless stated otherwise. \n   \n 1.2 Basis of accounting \n The condensed consolidated set of financial statements included in this Interim Financial Report have been prepared in accordance with International Accounting Standard 34 'Interim Financial Reporting' ('IAS 34'). \n   \n The condensed set of financial statements included within this Interim Financial Report for the six months ended 30 June 2025 should be read in conjunction with the annual audited financial statements of Distribution Finance Capital Holdings plc for the year ended 31 December 2024. \n   \n The annual consolidated financial statements of Distribution Finance Capital Holdings plc are prepared in accordance with International Financial Reporting Standards (\"IFRS\") as issued by the International Accounting Standards Board (\"IASB\") and the UK adopted IFRS. \n   \n The condensed consolidated financial information for the six months ended 30 June 2025 has been prepared using accounting policies consistent with IFRS. The interim information does not constitute statutory financial statements within the meaning of section 434 of the Companies Act 2006. The financial information for the periods ending 30 June 2025 and 30 June 2024 are unaudited but have been reviewed by the Company's auditor, Deloitte LLP, and their report appears on page 17 of this Interim Financial Report. The comparative figures for the year ended 31 December 2024 are the Group's statutory accounts and have been reported on by its auditor and delivered to the Registrar of Companies. The report of the auditor on those statutory accounts was unqualified, did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying their report, and did not contain a statement under Section 498(2) or (3) of the Companies Act 2006. \n   \n 1.3 Principal accounting policies \n The principal accounting policies adopted in the preparation of this financial information are set out below. These policies have been applied consistently to all the financial periods presented. \n   \n 1.4 Going concern \n The financial statements are prepared on a going concern basis as the Directors are satisfied that the Group has adequate resources to continue operating for a period of at least 12 months from the date of approval of the financial statements. \n   \n In making this assessment the Directors have considered the Group's current available capital and liquidity resources, the  financial projections of the Group, including the outcome of stress testing. Based on this review, the Directors believe that the Group is well placed to manage its business risks successfully within the expected economic outlook. Accordingly, the Directors have adopted the going concern basis in preparing the Interim Financial statements. \n   \n 1.5 Critical accounting estimates and judgements \n In accordance with IFRS, the Directors of the Group are required to make judgements, estimates and assumptions in certain subjective areas whilst preparing these financial statements. The application of these accounting policies may impact the reported amounts of assets, liabilities, income and expenses and actual results may differ from these estimates. \n   \n Any estimates and underlying assumptions used within the statutory financial statements are reviewed on an ongoing basis, with revisions recognised in the period in which they are adjusted, and any future periods affected. \n   \n Further details can be found in note 3 of these financial statements on the critical accounting estimates and judgements used within these financial statements. \n   \n 1.6 Foreign currency translation \n The financial statements are expressed in Pounds Sterling, which is the functional and presentational currency of the Group. \n   \n Transactions in foreign currencies are translated to the Group's functional currency at the foreign exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are retranslated to the functional currency at the foreign exchange rate ruling at that date. Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction. Foreign exchange differences arising on translation are recognised in the statement of income. \n   \n 1.7 New accounting standards issued but not yet effective \n   \n In April 2024 the IASB issued IFRS18 - \"Presentation and Disclosure in Financial Statements\". This is expected to impact the way in which information is disclosed in financial statements without impacting materially on the underlying accounting. \n   \n IFRS18 is expected to apply to the Group with effect from the financial year ending 31 December 2027, if the standard is endorsed for use in the UK. A detailed exercise to determine the impact of the new standard on the Group's annual reporting will be carried out before the implementation date. \n   \n Other than IFRS18 there are no new reporting standards and interpretations in issue but not effective which address matter relevant to the Group's accounting and reporting. \n   \n 2. Summary of material accounting policies \n   \n The same accounting policies, presentation and methods of computation are followed in the condensed consolidated set of financial statements as applied in the Group's latest annual audited financial statements for the year ended 31 December 2024. \n   \n 3. Critical accounting judgements and key sources of estimation uncertainty \n   \n The preparation of financial information in accordance with IFRS requires management to make judgements, estimates and assumptions that affect the application of accounting policies and reported amounts of assets and liabilities, income and expenses. \n   \n The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. \n   \n The areas involving the most complex and subjective judgements and areas where assumptions and estimates are considered to have the most significant effect on the financial statements are the same as those set out in Note 3 of the 2024 Annual Report and Accounts. A summary and updates regarding these critical accounting judgements and estimates are set out below. \n   \n Judgements \n   \n 3.1. Expected credit losses loan impairment \n   \n Significant increase in credit risk for classification in stage 2 \n Counterparties are classified into stage 2 where the risk profile of the borrower profile has significantly increased from inception of the exposure. This increase in credit risk is signified by either increases in internal or external credit ratings, the counterparty becoming over 30 days past due, or forbearance measures being applied. \n   \n The Group has aligned its assessment of significant increases in credit risk to its internal threshold criteria for prompting \n customer pricing reviews for consistency. \n   \n Due to the short-term behavioural term of the current lending portfolio, the Group has not applied a probationary (\"cooling off\") period to exposure...

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