North East pawnbroker and finance firm Ramsdens has hiked up full-year profit expectations on the back of strong performance.
The Middlesbrough company, which has 157 stores in the UK alongside its growing online business, said its foreign currency business had rebounded almost to pre-pandemic levels in the year ended September 30. In a stock market announcement it said: “As a result of this, the group expects to report annual profit before tax ahead of expectations.”
The firm, which operates in jewellery, foreign currency, precious metals and pawnbroking segments, announced in a pre-close trading update that foreign currency gross profit grew significantly, from £3.3m in 2021 to approximately £12.6m, driven by a recovery in volumes and improved margins.
It said demand for pawnbroking loans grew during the year as a result of customer spending habits returning following the easing of restrictions related to Covid-19, and fewer alternative options for small sum short term credit. Its loan book increased by over 40% to £8.6m – above the pre pandemic loan book of £7.7m at March 31, 2020.
Revenue in its jewellery retail segment grew by more than 40% to £26.2m, driven by investments in stock and improved merchandising, and precious metal buying volumes increased throughout the summer, aided by the high gold price and increased footfall. Revenue was up more than 50% to pre-pandemic levels of around £16m.
CEO Peter Kenyon said: “We are pleased with the Group’s very strong performance during the year, which again reflects the resilience of our business model and the strength of our value-for-money reputation amongst customers. We are particularly pleased with the strong rebound in our foreign currency segment, which has been a key driver behind our profit performance.
“Our staff have continued to deliver fantastic service to our growing customer base, and I would like to take this opportunity to publicly thank them all for their commitment. We continue to invest in attracting, retaining and rewarding our staff as we develop what I believe to be the best team in the industry.
“Ramsdens has recovered well from the impact of the pandemic, and while the economic backdrop is challenging and we are not immune to external cost pressures, the board is confident that with our diversified income streams, our value-for-money proposition and growing brand awareness, we are in a good position to continue our positive momentum into the new financial year.”