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(Alliance News) - International Personal Finance PLC on Tuesday said it swung to a pretax profit in the first half after a strong collections performance.
Shares in International Personal Finance were up 4.7% at 141.40 pence each in London on Tuesday.
Pretax profit for the six months ended June 30 was approximately GBP43.3 million, swinging year-on-year from a loss of GBP53.3 million.
The Leeds, England-based home credit and digital business posted revenue of GBP262.9 million, a fall of 25% from GBP362.2 million a year ago.
Group collections performance remained strong throughout the first half of the year and this, combined with the improving macroeconomic backdrop and its confidence in the quality of the portfolio, supported the firm's continued easing of credit settings, it said.
The improved year-on-year profit performance was reflected across all its business divisions, each of which was profitable in the first half of 2021.
The company has proposed an interim dividend of 2.2 pence per share, compared to the same period last year when the firm decided against a dividend.
"Building on the momentum achieved in the second half of 2020, we delivered a robust trading performance in the first half despite the challenging operational landscape caused by the ongoing Covid-19 pandemic. This very positive result was driven by a combination of lower impairment charges resulting from strong collections, very good new business credit quality and cost reductions, all of which more than offset lower revenue resulting from the smaller portfolio," the business said.
Going forward, International Personal Finance feels there remains "significant" long-term demand for affordable credit from this group of consumers in all its markets.
Its strategy is to build on the positive momentum generated in the first six months of 2021 by continuing to serve its customers safely, increasing credit issued and growing the receivables portfolio while maintaining a clear focus on portfolio quality, the company said.
Despite the impact of Covid-19, the firm expects to continue to deliver a strong rebound in full-year profitability in 2021.
By Amrit Sahota; newsroom@alliancenews.com
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