The sub-prime lender said revenues fell 15% to £446.9mln as it was forced to partially or fully suspend its home collections in its central European markets, while Mexico was less disrupted.
Customer numbers fell 17% to 1.8mln and credit issuance fell 42% to £378.2mln.
Higher impairments of £182.2mln led to a £53.3mln loss before tax.
The group said its equity to receivables ratio strengthened to 51.4% at June 30 from 44.8% at the end of December, while non-operational cash balances improved to £153mln at the end of August thanks to inflows during and after the half-year, versus drawings on bank facilities of £107mln a year ago.
Net debt reduced by £125mln over the period to £517mln.
All bank covenants passed in June but the board said it is “mindful of the short-term effect of Covid-19 on our future covenant tests so have commenced discussions on amending covenants with our banks” and is also “actively planning” for the refinancing of April 2021 Eurobond, of which around €400mln remains outstanding.
The need to refinance the 2021 Eurobond and obtain covenant amendments create a material uncertainty surrounding going concern, the company admitted.
Shares in IPF fell 12.5% to 65.1p in early trade on Tuesday.
Analysts at broker Shore Capital, which withdrew its forecasts earlier in the year due to the lack of clarity on the outlook caused by the coronavirus crisis and the associated withdrawal of guidance by the company, said, “with the picture now becoming clearer, and with a half year of numbers under its belt” and said it expects to reintroduce forecasts shortly.
In the second half, they expect loss to “materially narrow” and provisionally estimate a full-year loss before tax of £60-80mln.
“If the group is able to remain a going concern by refinancing the Eurobond then we think it should be able to return to full year profitability next year as (i) credit issuance improves driving loan and revenue growth (ii) impairments normalise (with some benefit from the reversal of temporary provisions) and (iii) the benefit of cost savings comes through.”
–Adds shares and broker comment–