Dominion Finance announces IPO

Thursday 10th June 2004

Dominion Finance Holdings has that it plans to raise $15 million to fund further growth through an Initial Public Offering.

The offer consists of five million new $1 shares offered by Dominion Finance Holdings and 10 million shares which are being sold by the interests of the firm's current owners Ann and Terry Butler.

The sell-down by the Butlers will provide liquidity in the market. The interests associated with Mr & Mrs Butler will hold approximately 72% of the shares on issue in the Company. Based on the issue price of $1 a share, Dominion Finance Holdings will have a market capitalisation of $55.5 million.

The company is the parent of Dominion Finance Group which has been in business for 50 years, tracing its origins back to Canterbury Advances in 1954. The business has been owned by Broadlands Dominion Group, Fletcher Challenge Group and NZ Guardian Trust before being acquired by interests associated with Terry and Ann Butler in 1987.

Under the Butlers' ownership the business transformed its focus from contributory mortgages and consumer and business finance to a specialist lender providing short term funds particularly for business loans, working capital and for residential and commercial property ownership and development.

It now has a loan book totaling $112 million.

"Finance companies provide much of the finance for small and medium sized businesses who are the drivers of the nation's growth. We are pleased to give investors the opportunity to have a stake in this sector again," Dominion Finance Holdings chief executive Terry Butler says.

In the last five years the business has grown rapidly. In the year to March 2000 operating revenue totaled $4.8 million dollars generating a net profit before tax of $1.4 million. Since then revenue has grown almost four times to $18.2 million for the year to March 2004 while net profit before tax has climbed fivefold to $8 million.

For the current year, ending March 2005, the prospectus forecast is for revenue to grow to $22.7 million and net profit before tax to $9.2 million.

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