Intrum banks on EC rules

Intrum Justitia, Europe's largest debt collection company, is banking on new European rules on late payments to drive its growth over the next few years.

The group, based in the Netherlands and listed in London, yesterday reported a slight drop in profits to £13.6m (£13.9m) in 1994 after a sharp contraction in its Scandinavian business.

But Bo Granson, Intrum's chairman, said the company was gearing up for a crusade to change attitudes to debt collection across Europe on the back of the European Commission's recommendations on late payment laws. The EC's report includes measures such as a statutory right to interest on late payments and compensation for collection costs.

Mr Granson said: "We have been lobbying Brussels for five years on this issue. The recommendation is almost an exact copy of Swedish legislation, which helped us grow so rapidly in the Scandinavian market. We are now perfectly positioned to benefit."

But as the group's profile was being raised, it suffered problems in its traditionally strong markets. Operating profit from the Nordic countries fell 25 per cent as a knock-on from the deep recession in the region. Finland, for instance, has seen one-in-five businesses go bust over the past three years.

In the UK, profits increased from less turnover, despite an investment of £600,000 in the group's new business-to-business service. This aims to convince small and medium-sized companies of the benefits of debt collection and credit management. Intrum says that it has signed up 3,000 clients in its first year, against the 1,000 budgeted for.