There is more evidence of the predicted 3.5M people turning to short term loans emerging from the private sector this week. Albemarle & Bond, who are a registered pawnbroker as well as offering online short, flexible loans, posted interim half yearly profits of £36.5M (before tax) and are well on course for their five year growth plan target as they approach the halfway point.
The report highlights, not only a company in the right place at the right time, but the options available to householders who are falling short of their financial requirements. Included in that figure, the heart of Albemarle & Bond’s success, is a 14% increase from its pawnbroking string. When you tag onto that its other financial services, such as short term loans (via Payday Anyway – its debit-card based facility) and a huge 88% rise in gold buying profit (before tax [PBT]) it just goes to show the rise in demand for their products.
All of this means that the instant cash loan lender’s pledge book grew 7%, delivering an astonishing two year growth rate to their overall ‘pawnbroking’ business of 39%. But the business does not intend to sit on its laurels and, if their predictions are accurate, we can look forward to another two years of austerity, grappling from one payday to the next, hocking anything we own as leverage on luxuries.
Why? Albemarle & Bond, having significantly increased their high street presence by opening 14 outlets between balance sheets to capture the market that has seen them return such incredible half-yearly figures, intend to have created fifty more stores in total over the two year period, 11 more this year and 25 in total, next. In their report, the stores are reporting their pledge book profits ‘ahead of expectations’.
It seems that, although the retail sector on the high street is reporting business-threatening shortages in footfall numbers, those who haven’t the connectivity to click on a instant cash loan are wearing their soles out to get to the pawnbrokers.
All in all, and this is just one short term loans company with a high street and online loan facility, don’t forget, their pre-tax profit for the half year is £12.1M.
The worrying thing for the economy and this is reflected in the statement that the company’s CEO Barry Stevenson made following the relaease of the report is that this source of finance is no longer the refuge of the hard-up individual; the plight of businesses has also seen them turn to the company’s facilities to help them through sticky patches.
Is there any light at the end of the global downturn tunnel? Maybe, but it’s a tiny dot and a long, long way off from here.