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9 Dec 2009 07:00
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For immediate release 9 December 2009
S&U plc
("S&U" or "the Company")
INTERIM MANAGEMENT STATEMENT
S&U,Β Britain's foremost niche home credit ("Loansathome4u") and motor finance ("Advantage Finance") provider,Β todayΒ issuesΒ an interim management statement for the period from 1stΒ August 2009 to 8thΒ December 2009.
Home Credit
Our well established home credit operationsΒ currentlyΒ account forΒ approximatelyΒ two thirdsΒ of Group profits.Β Β As credit available within the economy has tightened, so the virtues ofΒ home credit, whichΒ offersΒ flexibility, convenience and excellent service,Β haveΒ appealedΒ to aΒ growing customer base. As a result,Β trading in the second halfΒ thus farΒ has been encouraging,Β with both revenues and profitsΒ in line with our expectations.Β Debt quality is improving, impairment levelsΒ have improvedΒ compared toΒ last year, and the profile of our debt has led to increased levels of credit availability for our customers right across the business. As a result,Β levels of cash generation have remained very good,Β and we anticipate a successful ChristmasΒ period.
Motor Finance
Advantage,Β our motor finance business, has sensibly adapted to a more challengingΒ non standardΒ market byΒ raisingΒ underwriting hurdles and improving the quality of its debt. Its trading performance is in line with budget, reflecting a 5% increase inΒ Live accountsΒ compared toΒ last year. Despite lower levels of customer earlyΒ redemption,Β collection rates are driving strongΒ monthlyΒ cash generationΒ and impairment levelsΒ are stable.Β
Funding and Treasury
S&U's balance sheet continues to strengthenΒ and netΒ borrowing hasΒ been reducedΒ by Β£6 million to approximately Β£27 million as at 8 December 2009 (2008: Β£33 million)Β reflecting the Group's strong cashΒ generation. The company has significant headroom within existing facilities for both organic expansion and acquisitions.
Β
Commenting onΒ Group trading andΒ outlook,Β Anthony Coombs, Chairman of S&U plc said:
"The Group is trading in line withΒ marketΒ expectations for the year as whole and, as a result of continued prudent management,Β itΒ is in good shapeΒ to exploit the opportunities made available by recent industry consolidation. Whilst we take nothing for granted,Β we are confident of being able toΒ deliver a sustainableΒ improvement inΒ trading performanceΒ both inΒ the current year andΒ early inΒ the new decade."
We will update shareholders on trading in the important Christmas period in a year end trading updateΒ atΒ the beginning of February 2010.
For further information, please contact:
S&U plc www.suplc.co.ukΒ
Anthony Coombs, Chairman 0121 705 7777
Charles Stanley Securities
Mark Taylor / Freddy Crossley 020 7149 6000
Smithfield
Katie Hunt /Β Reg HoareΒ /Β Rebecca Whitehead 020 7360 4900
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