For Simworx, the GEF is a perfect fit says Terry: “It means that UK Export Finance guarantee back to HSBC our ability to fulfil the contract. That means that HSBC can release the deposit payment and we can use that as working capital for the duration of the project.
The facility has made a huge difference to the company’s cashflow, giving greater flexibility and enabling Simworx to pursue new contracts and its growth plans. Terry shares an example of some of Simworx’s latest projects to demonstrate the point.
"We’ve secured a project recently in Saudi Arabia, which required a guarantee of about £300,000. We could have funded that one ourselves but for the next project – a Flying Theatre to a client in Russia – which required a guarantee of around £600,000, we would have had to sit down, really go through projections and be reliant on other receipts coming into the business. Having an advance payment guarantee facility via the GEF makes each project more accountable, so you can ringfence the cashflow for that singular project without it being a drain on the main business’ working capital.
"When you’re talking about projects of that magnitude, the GEF definitely makes the running of our business much easier and rather than focussing on working capital, I can spend time on the continued growth of the business."