Pawnbrokers are booming in austerity Britain

Click to follow
The Independent Online

The takeover of Britain's high streets by the pawnbroking industry is continuing apace as H&T Group, one of the big two along with Albemarle & Bond, hit the 150 store mark and said first half pre-tax profits before one-offs broke the £10m barrier.

The company said it had opened 11 new stores in the first half of the year, taking the total to 146, but has since added a further four with leases signed on another six.

The company has a target of 25 new openings for the full financial year, so is likely to open another four, with more to follow in 2012. Sales excluding new openings slipped by 12 per cent but the shortfall was made up by a rise in profit margins.

Overall pre-tax profits came in at £10.3m, up from £9.6m last time (excluding a one-off gain of £4.9m). The interim dividend of 3.75p compares with 3.5p last time.

H&T is also continuing to build on its gold business, converting six units into "Gold shops" or "H&T Lite" stores to capitalise on the popularity of selling gold. In addition to its stores it has 45 market-stall style "Gold bar" outlets in shopping centres.

That has been driven by the relentless rise of the gold price, as investors seek a safe haven at a time of economic uncertainty and turbulent markets. With record prices being set daily, that is unlikely to slow down.

Concerns have been expressed at the rise of the pawnbroking industry, which has in part grown because "sub-prime" borrowers have had to turn to it as a source of credit.

However, commercial director Steve Fenerty defended the company's offering as reasonable and flexible. "We offer a service our customersvalue," he said.

"Our loans are of relatively lowvalue and for short times."