Pawnbroker H&T sees profits soar

The pawnbroker H&T Group has forecast its profits will be higher than expected after a record-breaking year for its business.

Profits for 2010 should exceed the upper end of City expectations of £26m after consumers increasingly turned to its H&T pawnbroking and gold bar jewellery buying outlets.

The company's commercial director, Steve Fenerty, said the downturn had raised the profile of the business; but added that the growth was mainly down to new stores and the rising gold price, which gained a third over the year.

Mr Fenerty said: "The rising price of gold has helped people realise the value of some of their jewellery and has helped raise our profit margins. The market has been underserved for a very long time and we were expanding before the recession hit."

The pawnbroking business saw record lending levels in 2010 driven by an increase in the average loan and by opening new stores.

Tesco recently announced its move into pawnbroking but Mr Fenerty said it was unlikely to pose a threat to H&T because it offers a postal service rather than an on-the-spot valuation.