Aggressive expansion plans continue as profits jump 26%.
Pawnbroker Albemarle & Bond is making a boom out of the bust as it continues to show off a strong financial performance in its latest results.
The pawnbroker revealed gross profit was up 26 percent to £53.6 million for the year to June 30 and turnover at the group jumped 48 percent year on year to £82 million.
Albemarle & Bond said that the positive results were driven by a strong pawnbroking business, which accounts for 53 percent of profits, and a blossoming cash-for-gold arm, which in its first full year contributed £11.5 million to gross profits.
Albemarle & Bond chief executive Barry Stevenson said: “Strong execution of our core pawnbroking activities were key to this result, delivering an excellent performance of 16 percent growth in the pawn loan book as at the year end, driven by competitive lending rates along with a material improvement in the unredeemed rate.
"Gold buying was a significant profit driver as we capitalised on the increased consumer awareness of the higher gold price and competitor advertising. Importantly, gold buying gross profits grew throughout H2 and gross profits have been sustained since the year end against a background of volatile gold price movements. Our research in the UK and in the more mature US market suggests gold buying will continue to be a convenient and viable means of accessing cash amongst our growing target customer base”.
The group has embarked on an ambitious expansion plan opening 17 full-line stores and 15 pop-up shops in the financial year, increasing the group’s total number of points of sale to 147.
Albemarle & Bond said that the new full-line stores are trading “ahead of forecasts” and it is planning to open more pop-up shops and 25 full-line stores, under the Ablemarle & Bond and Herbert Brown fascias, this financial year.
Jewellery retailing at the group did suffer as gold prices put shoppers off buying jewellery. To combat potential losses the group scrapped a higher proportion of its ex-pledge stock and as a result profits in the division fell to £6.5 million compared to £8.5 million in 2009.
Looking to the future, the group will continue to implement its five-year growth plan announced earlier in the year. The plan will focus on making the group’s services more accessible by opening new stores, increasing awareness through marketing, improving efficiency at the group and improving customer experiences.