Oxygen Finance, a subsidiary of TruFin (TRU ) and a leading early payments programme provider, said it has secured six new Early Payment contracts with local authorities in Q1 2023. This brings Oxygen's total number of Early Payment clients to 54, with an annual spend of over £24bn.
The newly added local authorities represent nearly £3bn of procurement spend and include Cumberland Council, Derbyshire County Council, Leicestershire County Council, London Borough of Camden, Peterborough City Council, and Westmorland and Furness Council.
Oxygen's programmes offer faster supplier payment, improved efficiency, and cost savings for local authority clients, effectively protecting vital frontline services.
Ben Jackson, Chief Executive Officer, Oxygen, said: "Supply chain disruption leads to reduced working capital for suppliers which, coupled with rising interest rates, makes Early Payment Programmes more relevant than ever. It's fantastic to see more local authorities realising the benefits of early payment and delivering on their social value ambitions whilst achieving savings to protect services. We're excited to be working in partnership with each of these new clients".
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Another significant milestone for Oxygen, which is well-positioned to help both suppliers and local authorities in navigating the growing issues of supply chain disruption and rising interest rates. By paying suppliers early, local authorities can help to improve cash flow and boost growth by injecting liquidity into local economies.
In TruFin’s final results for FY22, Oxygen came out as a top performer among the company’s four subsidiaries, with EBITDA increasing 62% to £1.1m in the period and delivering revenues of £5.3m, up 28% year-on-year. Oxygen has continued along this strong trajectory in 2023, with Q1 revenues experiencing double-digit growth when compared to the same period in 2022.
A key driver to Oxygen’s success is its internal initiative to help clients purchase multiple products, which resulted in over 27% of Oxygen's local authority Early Payment clients also committing to at least one Oxygen SaaS subscription in 2022.
In December 2022, Oxygen received a buyout offer which valued the subsidiary at £26m. TruFin said that given its significant and growing embedded revenue base, it felt justified in rejecting the unsolicited bid for Oxygen.
In light of today's news, it is clear that Oxygen is poised for a transformative year ahead. With a focus on maximising profitability and winning over new clients, Oxygen is capitalising on the increasing recognition of the benefits offered by its Early Payment Programmes.
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