Orchard Funding Group plc
Orchard Funding Group plc is an AIM-listed UK specialty lender that, through wholly (and one 90%-owned) subsidiaries, provides insurance premium finance, professional fee funding, finance for other service fees and secured property bridging lending. It operates a 'hold to collect' model, lending to brokers' own finance companies (PFCs) and directly to end borrowers, funded by bank facilities, a retail bond and own resources, with all lending within the UK.
10 annual reports read, FY2016 to FY2026
Open a year to see what its report said. Every line in it carries the page it was read from.
Sources: Companies House (10)
FY2027Next report expected 18 Jun 2027
- Open the reportJSONComing soonSixty seconds on the FY2026 report
Orchard Funding Group plc lends money in the UK, mainly to help people and businesses spread the cost of insurance premiums and professional fees. This report covers the 18 months to 31 January 2026, so it is compared with a shorter 12-month year to 31 July 2024. Revenue was £15.7m against £9.6m, and profit before tax was £6.6m against £2.1m. The report credits higher lending, especially direct insurance finance and loans to brokers' own finance companies, plus falling interest rates that cut its own borrowing costs. Losses from unpaid loans were also much lower. At the period end it held £1.1m in cash and its borrowings were £33.6m, down from £40.2m. No new shares were issued. Dividends for the period total 4p a share, against nothing the year before, though part of this still needs shareholders' approval. Management called the results very positive but warned that the outlook has become more challenging. It pointed to uncertainty over interest rates and to a review of motor finance by the City regulator, which affects one of its businesses. The auditors gave a clean opinion and raised no doubt about the company's ability to keep trading.
From the reportevery line sits on the page it namesWhat drove revenueDirect insurance premium finance
Direct insurance lending grew 71.98% (ex-Toyota) over the 18-month period vs the prior 12 months; largest contributor to premium finance growth
page 9AndPremium funding company (PFC) lending
PFC lending volumes rose to £84.9m (59.89% growth) as brokers/accountants run their own finance companies
page 9What moved the margintailwindFalling base rates/SONIA during the period
Average cost of finance fell to 7.68% (year to 31 Jul 2024: 7.99%); net interest margin rose to 21.74% (annualised 14.49%) from 11.58%
page 9AndheadwindInability to pass base rate rises to customers immediately
Higher-than-historic base rates impacted the business through the first part of the period, with a direct and immediate impact on cost of funds
page 4What management saidProfit before tax for the 18 months was £6,592k, a very positive financial performance with increased lending volumes and improving margins
page 3The dividendInterim dividend of 2p and special dividend of 1p paid during the 18-month period (3p paid to date); proposed final dividend of 1p per share to be paid 30 July 2026 to shareholders on the register at 10 July 2026 (ex-div 9 July 2026), subject to shareholder approval at the AGM on 23 July 2026. No formal fixed payout policy is stated beyond delivering 'sustainable returns' to shareholders.
page 50Going concern and the auditUnmodified ('true and fair view') audit opinion from MCA Audit Limited; one key audit matter for the group (calculation and disclosure of expected credit losses), none for the parent company; group materiality £315,000 (2024: £192,500). Going concern basis adopted; directors reviewed four-year rolling projections and stress tests and found no indication of going concern issues; no material uncertainty identified by the auditor.
page 23The risks it names first- Credit risk - debtors or guarantors defaulting, mitigated by prudent underwriting, recourse arrangements and regular impairment reviews; risk appetite to limit reported credit losses below 0.5% of income-generating assetsp.7
- Liquidity risk - lack of funding to finance the business; general facility and Orchard Finance facility renewals in progress in 2026 with no indication funders will withdraw support; retail bond due for redemption June 2027p.7
- Interest rate risk - lending at one rate while borrowing at a higher rate reduces margins; risk appetite is to keep net interest margin on new lending above 7.5%; mostly mitigated by short-term (up to 12 month) lendingp.7
- Non-repayment risk on the five-year retail bond (£3.90m raised); no risk appetite for non-repayment, mitigated by cash position expected to cover redemption and a parent guarantee of up to 10% of redemption valuep.8
Read from C000949-AR-2026-ch.
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