ThinkSmart Limited
Climate Impact & Sustainability Data (2016)
Reporting Period: 2016
Environmental Metrics
Governance Achievements
- Realigned the Board with a UK focus in anticipation of AIM listing. David Griffiths retired, David Adams joined as Non-Executive Director and Chair of the Audit Committee. Ned Montarello became Non-Executive Chairman upon AIM admission. Keith Jones became Non-Executive Director and Deputy Chairman. Gary Halton became Executive Director. A new UK-based Non-Executive Director was to be appointed.
Climate Goals & Targets
Medium-term Goals:
- New mobile leasing product targeted to achieve immediate and significant volume growth, with profit spread across the term of each contract through lease accounting, and increasing over time through the high level of anticipated repeats.
Short-term Goals:
- Significant growth in active customer base.
- Maximise margins through efficient ‘on balance sheet’ funding and continued systemic bad debt management.
- Improvements in operational leverage benefiting from scale reduction in per unit operating costs.
Environmental Challenges
- Challenging second-half volumes in the UK with unanticipated delays in launching key initiatives and new products.
- Credit risk from defaulted customers and the company's receivables and exposures.
- Achievement of volume growth dependent on retail partners' strategies, key relationships, ability to establish new partnerships, regulatory risks, product lines, and the broader economic environment.
- Funding dependent on availability and cost of funds, ability to secure funding for lease receivables, and macroeconomic factors.
- Concentration risk due to the majority of business volume coming from Dixons Carphone Group.
- Currency risk due to the denomination of income and liabilities in GBP.
Mitigation Strategies
- Improved margins from reduced funding costs and improvements in bad debts in the UK.
- Robust credit checking and collections processes, continual development of market-leading IP in credit risk management.
- Extended the £60m funding arrangement with STB to July 2018 on improved terms and complemented the £10m 5-year revolving credit facility with Santander.
- Long-term exclusive contract with Dixons Carphone Group extended to 2019.
- Sophisticated credit assessment and fraud minimization process through patented SmartCheck system.
- Specialist collections function to manage delinquent accounts.
- Close monitoring of credit risk associated with each funder deposit counterparty.