LONDON (Alliance News) - S&U PLC, a motor finance provider, on Friday said it remains on the lookout for potential acquisitions and start-up opportunities, though it will continue to invest in its Advantage Finance business and maintain shareholder returns.
The company said its search for acquisitions continues after its suspicion of "unrealistic pricing last year" was confirmed by recent drops in equity markets, meaning there could be "better value" in the coming months.
In S&U's update, which covered December 10 to January 31, the company also said current trading remains strong and in line with market expectations.
Its Advantage Finance motor lending arm is continuing to produce "record" results, S&U said.
Live customer numbers are up 32% on the same time last year, at about 32,500. Budgeted new transactions were "exceeded comfortably", mainly due to investing GBP27 million in Advantage Finance over the past financial year.
S&U said it has refined its underwriting systems to "deepen" its understanding of its customers, which should encourage higher margins. As a result, S&U said, monthly collections are now approaching GBP7.0 million.
"Although the slight rise in real incomes in Britain over the past year has led to greater consumer confidence, particularly in the car market, current economic uncertainties will place a premium on those finance companies possessing the best underwriting systems and highest debt quality," Chairman Anthony Coombs said.
"Coupled with a more stable political and regulatory environment, that will continue to reward the business methods and customer focus for which Advantage Finance is rightly admired," Coombs added.
S&U shares untraded early Friday at 2,040.00 pence.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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S & U (SUS)