Company’s pre-tax profits for first six months hit £10.3 million.
Harvey & Thompson (H&T) Pawnbrokers has announced its interim results for the six months ended June 30, with a pledge book increase of 10.5% and profit before tax of £10.3m.
The pawnbroker’s results showed that profit before tax reached £10.3m compared to the same period in 2010 when profit reached £9.6m. The company’s pawn broking service charge increased 14.3% to £13.2 and its pledge book increased by 10.5% to £41.2m, compared to the same period last year which reached £37.3m.
The company has opened 11 new stores in H1, brining the total to 146 as of June 30, with an additional four stores opened since that date and a further six provisional leases agreed.
H&T has also launched new schemes in the first six months of 2011, including its on-line pay day loans and has deployed new models of service in-store, accessing a wider customer base. The company has also enhanced its central pricing and central distribution capabilities.
Speaking about the results, H&T’s chief executive John Nichols said: “We are delighted to report another excellent set of results, with profit before tax of £10.3m for the first six months of 2011. Trading has been especially strong in the H&T group’s core pawnbroking operations with year on year increases in the key performance indicators of both lending and redemption."
"As a result, the gross pledge book has risen to £41.2m as at 30 June 2011 and the group has delivered a 14% increase in its key revenue stream, the Pawn Service Charge," he explained.
Nichols said he was pleased with the performance of the stores that have been added to the company’s portfolio in recent years, and says the continue to prove themselves and their growth potential.
"We have opened 15 new stores year to date, including the achievement of a significant milestone for the group with the recent opening of our 150th store. In addition the group currently has 45 Gold Bar retail mall units," explained Nichols.
The company has seen its retail sales fall 12%, but its margins had increased to 50%. Steve Fenerty, commercial director of H&T explained to Professional Jeweller that this was because the company had actually been selling its gold at almost scrap prices – in some cases 30-50% cheaper than new products on the high street.
"We bought in gemmologist and jewellery consultants," explained Fenerty. "As a result we increased our retail prices, which is why sales dropped but we are now selling products at the correct prices hence our margins increasing."
The company says that its rings, priced between £30-40 are its bestsellers, and it is in fact struggling to fill the demand for such products.
Nichols said that H&T’s outlook remains positive and on the basis of the current gold price the company expects its full year results to be above the top end of current market forecasts.
With plans to open new stores, three of these will be H&T Lite concept stores, which are pop-up, small-scale units in department stores which the company trials to gauge reception. If feedback is good, it will typically open a larger H&T store in the area. The remainder of the stores will be full-scale H&T outlets, with no specific geographic area.
The H&T board has approved an interim dividend of 3.75 pence, which itself represents compound growth of 23% per annum since flotation.