Consumer lender MoneyMe has a month to pay down around one-third of its corporate debt facility or face a demand to repay the full A$78 million balance. The company’s financial report for the six months to December acknowledges that if it is unable to meet its commitment under a revised funding agreement with Pacific Equity Partners “a material uncertainty would exist that may cast significant doubt on the group’s ability to continue as a going concern and, therefore, its ability to realise its assets and discharge its liabilities in the ordinary course of business”. In December, MoneyMe revised its syndicated facility agreement with PEP, including a reset of financial covenants and a requirement to meet agreed milestones relating to the progression and implementation of a strategic capital initiative. The milestones include an obligation to pay down $25 million, plus accrued interest, fees and other amounts, in the March quarter in order to bring the balance of the debt facilities outstanding under the facility agreement to $50 million. At December 31, the outstanding amount was $78 million. If MoneyMe is not compliant with the finance agreement, or if agreement on alternative terms or an extension of time cannot be reached with PEP, it will be required to repay the total amount outstanding (plus accrued interest and fees) under the finance agreement by the end of this year. MoneyMe said it has accelerated its strategic capital program and engaged an investment bank to assist in sourcing alternative funding. Initiatives under consideration include “a range of corporate transactions” and the company is in ongoing discussions with “interested credible parties”. MoneyMe chief executive Clayton Howes emphasised at an investor presentation yesterday that the company is in a strong earnings and cash flows position after a heavy loss in 2021/22. MoneyMe acquired SocietyOne last year and the December half was the first full reporting period reflecting the impact of the acquisition. Interest income was $118.7 million for the half – almost three times the $44.7 million of interest income in the previous corresponding period. Operating expenses rose from $66.3 million in the December half 2021 to $110.4 million in the latest half. Net profit was $8.8 million, compared with a loss of $18.7 million in the previous corresponding period. Net cash flow from operating activities more than doubled to $73.4 million. The customer receivables impairment expense was $34.3 million. The average cost of funds rose from 5.3 per cent in the December half 2021 to 6.5 per cent in the latest half. Howes said the company took a cautious approach to loan originations during the half, which was reflected in higher credit scores of new borrowers. Originations of $242 million were down 45 per cent on the previous corresponding period. Average gross customer receivables during the half were $1.2 billion. The company has undrawn warehouse funding of $430 million.