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LONDON (Alliance News) - H&T Group PLC Thursday said its profits were hit by lower gold prices and reduced profits from its pawnbroking scrap and gold purchasing operations as the company focuses on rebranding and relocating its sites to deal with a more "competitive environment".
H&T Group is a company that provides financial lending services to the non-standard credit population, and consists of H&T Pawnbrokers, H&T GoldBar and Sona Loans.
For the year ended December 31, the company said revenue fell to GBP87.7 million from GBP99.3 million in 2013, mainly hit by the fall in gold prices and "competitive environment", it said.
H&T's operating profit followed suit and fell to GBP6.2 million compared to GBP7.6 million, leading to a pretax profit of GBP5.5 million, down from GBP6.7 million a year earlier.
The company reduced administrative expenses during the year to GBP7.8 million, from GBP9.4 million a year ago, while finance costs also fell by GBP134,000.
Despite the fall in revenue and profit, the company maintained its final dividend of 2.7 pence per share, bringing the full year dividend to 4.8 pence. Both are flat from 2013.
H&T also reduced its net debt in 2014 by over 50% to GBP9.7 million from GBP20.7 million at the end of 2013.
"This reduction has lowered the risk in the business, but from this position we now need to develop a group of profitable products that reduces the impact of gold price volatility," said the company.
H&T said falling footfall on UK high streets and increasing use of the internet to deal in commodity-related goods and services is requiring it to adapt to a more "competitive environment", and said it will "develop a strong presence" in shopping malls in the UK, which have a higher footfall, and said it will look at new branding away from the term "pawnbrokers", to attract customers and secure new locations that would usually be reluctant to award premises to pawnbrokers.
"We will need to relocate stores where their location has a reducing footfall, to those places where it will grow. The combination of on-line presence, high visibility and an attractive range of products will be important," said the company.
H&T shares were up 4.2% to 169.25 pence per share on Thursday morning.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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