Key performance indicators

The group uses a number of KPIs to assess progress against each of its strategic objectives, including both financial and non-financial measures.

Our performance during 2015, measured using these KPIs, together with our plans for 2016, are set out below.

These KPIs are helpful in assessing progress but are not exhaustive as management also takes account of a wide range of other measures in assessing performance.

Growing high-return businesses in non-standard markets

  • Maintain strong growth in Vanquis Bank within the UK non-standard credit card market, whilst seeking opportunities to utilise the existing business model to expand into other markets and products; 
  • Maximise returns within the Provident home credit business whilst developing the Satsuma online loans business to generate sustainable growth; 
  • Develop the glo guarantor loans business to be capable of delivering the group’s target returns;
  • Continue to unlock the growth potential within Moneybarn in the non‑standard vehicle finance market; and 
  • Extend our product offerings to ensure that we have the appropriate range of products for our chosen markets.

Adjusted profit before tax £m


Group profit before tax up 25.0% to £292.9m (2014: £234.4m):

  • Continued strong growth and favourable margins at Vanquis Bank generated a 22.8% growth in UK profit before tax to £185.5m (2014: £151.0m);
  • CCD delivered a modest increase in profits to £105.4m (2014: £103.9m) reflecting the impact of improved margins and cost reductions in home credit offsetting the impact of a 7.3% reduction in the receivables book and continuing investment in Satsuma and glo; and
  • Good performance from Moneybarn, contributing a profit before tax of £21.3m in its first full year since acquisition (2014: £5.8m in the four months post-acquisition).

Group ROA %


Higher group ROA of 16.1% (2014: 15.1%), primarily reflecting improved returns at CCD.

Group ROE %


ROE of 46% (2014: 47%), marginally lower than 2014 due to the full-year impact of the £120m equity raised to fund the Moneybarn acquisition.

Returns – Vanquis Bank – UK (%)


Moderation in the RAM to 32.8% (2014: 33.2%) reflects the ongoing impact of the reduction in revenue yield and reduced interchange income following European legislation reducing interchange fees. Continued strong returns, delivering a modest uplift in UK ROA of 15.8% (2014: 15.5%), with the benefit of operational leverage more than offsetting the reduction in the RAM.

Returns – CCD (%)


Significant uplift in the RAM to 82.2% (2014: 69.1%) due to the marked improvement in the quality of the receivables book from tighter underwriting and the drive to implement standardised arrears and collections processes.

ROA strengthened to 21.2% (2014: 18.1%), resulting from completion of the transition of the home credit business to a smaller but leaner, better-quality, more cost‑efficient business focused on returns.

Returns – Moneybarn (%)


Stable RAM and ROA of 24.3% (2014: 24.6%1) and 12.9% (2014: 12.9%) with the business investing in headcount to support the future growth of the business.

  1. Represents pro forma full-year results restated to apply the group’s lower cost of funding to pre‑acquisition results.

Generating high shareholder returns

  • Generate sustainable growth in profits and dividends to deliver increasing shareholder returns; and
  • Maintain a dividend cover of at most 1.25 times.

Adjusted earnings per share (p)


Adjusted earnings per share up 22.6% to 162.6p (2014: 132.6p), a lower rate than the 25.0% growth in adjusted profit before tax as a result of the impact of the 5.9 million placement of shares for the acquisition of Moneybarn in August 2014, partly offset by the reduction in the statutory rate of UK corporation tax from 21% to 20% on 1 April 2015.

Dividend per share (p)


Dividend per share increased by 22.6% to 120.1p (2014: 98.0p), supported by the group’s growth in earnings and strong capital generation resulting in a dividend cover of 1.35 times (2014: 1.35 times).

Total shareholder return (%)


Strong annual total shareholder return of 40.9% in 2015 (2014: 57.0%).

Maintaining a secure funding and capital structure

  • Maintain borrowing facilities which, together with Vanquis Bank’s retail deposits programme, meet contractual maturities and fund growth over at least the next 12 months;
  • Maintain a maximum gearing ratio of 3.5 times to ensure alignment with the minimum dividend cover target of 1.25 times and the group’s growth plans, whilst maintaining a comfortable surplus of regulatory capital over the capital requirements set by the Prudential Regulation Authority (PRA); and
  • Continue to diversify the group’s sources of funding.

Gearing (times)


Gearing reduced to 2.2 times (2014: 2.4 times) compared with a maximum target of 3.5 times and a banking covenant of 5.0 times. This reflects strong capital generation including the shrinkage of the home credit receivables book following the repositioning of the business.

Acting responsibly and with integrity in all we do

  • Operating our core business of lending to our customers in a responsible and sustainable manner, putting their needs at the heart of everything we do;
  • Acting responsibly and sustainably in all our stakeholder relationships in order to:
    • Create a working environment that is safe, inclusive and meritocratic;
    • Treat our suppliers fairly; and
    • Support our communities.

Customer satisfaction (%)


Customer satisfaction of 93% for Provident home credit (2014: 93%), 88% for Vanquis Bank (2014: 84%) and 89% for Moneybarn in its first full year under the group’s ownership. 

Community investment (£m)


Invested a total of £3.1m in various community programmes, money advice programmes and social research (2014: £2.4m).



KPI descriptions:

Adjusted profit before tax – Profit before tax, the amortisation of acquisition intangibles and exceptional costs.

Return on assets (ROA) – Adjusted profit before interest after tax as a percentage of average receivables.

Return on equity (ROE) – Adjusted profit before tax as a percentage of average equity. Equity is stated after deducting the group’s pension asset, net of deferred tax, and the fair value of derivative financial instruments, and the proposed final dividend.

Risk-adjusted margin (RAM) – Revenue less impairment as a percentage of average receivables.

Adjusted earnings per share – Profit after tax, excluding the amortisation of acquisition intangibles and exceptional costs, divided by the weighted average number of shares in issue, excluding own shares held by the group.

Dividends per share – The total dividend per share, comprising the interim dividend per share paid and the proposed final dividend per share.

Gearing – Borrowings (based on contracted rates of exchange and excluding deferred arrangement fees) less the liquid assets buffer, including liquid resources, divided by equity. Equity is stated after deducting the group’s pension asset, net of deferred tax and the fair value of derivative financial instruments, in line with the group’s banking covenants.

Customer satisfaction – The percentage of customers surveyed who are satisfied with the service they have received.

Community investment – The amount of money invested in support of community programmes, money advice programmes and social research.

Total shareholder return – The change in the group’s share price, together with any dividend returns made to shareholders