Interim Management Statement

RNS Number : 6580T

S & U PLC

09 December 2011

 



9 December 2011 

S&U plc ("S&U" or "the Group")

Interim Management Statement

S&U, Britain's foremost niche home credit (Loansathome4u) and motor finance (Advantage) provider, today issues an interim management statement for the period from 1 August 2011 to 8 December 2011.

Home Credit

Against an increasingly troubled wider economy, it is encouraging that our loyal customers continue to rely upon Loansathome4u. Our focus on customer service has seen the fundamentals of our home credit business, sales, collections and impairment, continue to perform at very satisfactory levels. Debt quality continues to improve and is reflected in healthy credit availability for our customers. This is testimony to the energy, commitment and attention to detail of our home credit team.

Customer numbers are growing and despite our traditionally cautious underwriting, stand at just under 2% above last year. Home credit retains its cash generative qualities, costs are in line with budget, and we approach the all important Christmas trading period with confidence. 

Motor Finance

Advantage, our motor finance business, is maintaining its impressive form.  Customer numbers are over 12% up on last year and despite some lenders returning to the market, sales growth is strong and margins have improved.  Equally important, Advantage's debt quality is at its highest level as new customers perform to terms.   As careful underwriting and good customer service pay dividends, monthly customer repayments now average a regular £2.5 million and impairment rates continue to fall. 

Over the past quarter Advantage has broadened and refined its product range attracting higher income customers as well as nurturing its traditional customer base. The excellent team at Advantage faces the future with confidence.

Funding and Capital

Notwithstanding strong trading throughout the Group, good collections and cost control have resulted in borrowings falling during the quarter allowing the Group's financial position to grow ever stronger. This cash generation and the new five year funding facility referred to in our interim report has allowed our medium term loan with RBS to be fully repaid ahead of schedule. The Group five year and shorter term bank facilities give wide scope for organic growth and new ventures. 

Commenting on Group trading and outlook, Anthony Coombs, S&U Chairman, said:

"Whilst it would be unwise in the current economic climate to take Christmas sales and collections for granted, current trading is strong and underpinned by a solid financial base. Expectations and Group morale are high and we hope to confirm these promising trends at our year end trading update on 17 February 2012."

For further information, please contact:

S&U plc www.suplc.co.uk 

 Anthony Coombs, Chairman                                      0121 705 7777

Financial Advisers, Sponsors and Brokers

Adrian Trimmings / Jamie Cameron                           Arden Partners                      

                                                                                     020 7614 5920

Media and Investor Relations

Will Swan / Rebecca Whitehead                                Smithfield                              

                                                                                     020 7360 4900 

 

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