Time Finance’s Ascendant Trajectory: FY 2024-2025 Outlook Reaffirmed Amid Strategic Momentum

Time Finance plc has emerged as a compelling investment case in the UK’s SME lending sector, with its recent reaffirmation of FY 2024-2025 financial targets underscoring robust growth and operational discipline. The company’s upward revision of revenue guidance to £36 million and profit before tax (PBT) to £7.5 million—from prior estimates of £35.1 million and £7.2 million—reflects a confluence of strategic execution, market demand, and disciplined risk management.

The Q3 2025 Update: A Catalyst for Confidence

The company’s Q3 trading update, released on 25 March 2025, provided the clearest validation yet of its revised outlook. For the nine-month period ending 28 February 2025, revenue rose 14% year-on-year to £27.3 million, while PBT surged 40% to £5.9 million—already exceeding the entire PBT of the previous fiscal year (FY 2023-2024). A key driver was the expansion of its secured lending portfolio, which now constitutes 81% of the total lending book, up from 52% pre-strategy. This shift has not only boosted margins but also maintained credit quality, with net arrears at 5% and net bad debt write-offs stable at 1% of the average lending book.

Strategic Pillars Fueling Growth

1. Secured Lending Dominance:
   Time Finance’s focus on invoice finance and hard asset finance—products that align with its “own-book” lending model—has been pivotal. These segments now account for 91% of new lending volume, driving the total secured portfolio to £103 million as of January 2025. This strategic emphasis reduces reliance on third-party brokers, enhancing profitability and control over credit risk.

2. SME Demand Resilience:
   The UK SME sector remains a core customer base, with Time Finance’s flexible funding solutions proving critical for expansion. Recent examples include a £500,000 facility for cybersecurity firm Red Security to scale operations—a testament to the company’s ability to serve niche markets.

3. Margin Expansion:
   PBT margins improved by 200 basis points to 21% in Q3 2025, reflecting operational efficiency gains. This is critical as Time Finance aims to grow its total lending book to £300 million by 2028, a target supported by its current trajectory.

Risks and Considerations

While the outlook is positive, investors should monitor:
- Market Volatility: A slowdown in SME demand or rising interest rates could strain borrowing costs.
- Execution Risks: Scaling to £300 million requires sustained origination momentum and disciplined credit underwriting.

Conclusion: A Compelling Growth Narrative

Time Finance’s reaffirmed FY 2024-2025 outlook is underpinned by data-driven confidence:
- Revenue Growth: £27.3M in nine months (vs. £24.0M in 2023), with full-year guidance on track to exceed £36M.
- Margin Strength: PBT of £5.9M (up 40%) and a 21% margin, signaling operational leverage.
- Strategic Scale: A £210M gross lending book (up 11% year-on-year), with secured lending now 81% of the portfolio—a structural shift that reduces risk and boosts profitability.

The company’s disciplined focus on secured lending, coupled with strong demand from UK SMEs, positions it to deliver on its long-term targets. With audited FY results due in September 2025 and a Q1 2025/26 update following shortly after, investors are well-positioned to monitor progress. For those seeking exposure to a high-growth, risk-managed lending model, Time Finance’s trajectory remains compelling.

In a sector where credit quality and scalability often collide, Time Finance’s metrics—15 consecutive quarters of lending growth, stable arrears, and margin expansion—suggest it has struck the right balance. The reaffirmed outlook is not just a financial target but a reflection of a business primed to capitalize on its strategic vision.