Pawnbroker H&T eyes rival in expansion bid
Tuesday 07 January 2014
Pawnbroker H&T is turning its attentions to expansion, and has struggling rival Albemarle & Bond in its sights.
The company said it “will look to acquire profitable pawnbroking opportunities”, with chief financial officer Steve Fenerty refusing to rule out looking at snapping up some of Albemarle’s better-performing sites.
Fenerty added: “We are looking at expansion in several areas, and we strengthen our position by moving into strategic positions where we are only lightly represented.”
Albmarle’s profits have tanked and the business nearly collapsed after it failed raise enough funds from its biggest shareholder — a rival US pawnbroker EZCorp — to avoid breaching banking covenants. Instead, it has been on a major cost-cutting exercise, shutting nearly all its pop-up cash-for-gold shops, ending new payday loans and even melting down its gold reserves to generate some more cash.
Bosses last month put the business up for sale, with EZCorp said to be interested, after all Albemarle’s non-executives resigned, including representatives from the US business.
Better Capital was revealed as one suitor, but within a fortnight of being outed, the company withdrew its interest. H&T has managed to avoid similar problems despite suffering from the same fall in gold prices — down 29 per cent over the year — and said profits will be in line with expectations.
Fenerty said: “We’ve had less debt [than Albemarle] and structured the business in a way that if gold prices fell we’d be able to rely on other parts of the business.
“We’ve always said gold prices would continue to rise at the same pace. While the gold price going up was brilliant, it was never going to go up forever.”
Its lending business has seen the pledge book reduced by 14.5 per cent to £44.1 million as lending rates fall but sales in the retail jewellery business was up 56 per cent on last year.
The pawnbroking and payday loans industry boomed in the recession, especially cash-for-gold sites. But many have suffered with the gold price falling. Companies will soon start being regulated by the Financial Conduct Authority instead of the Office of Fair Trading, something Fenerty welcomed.
He said: “The FCA would say they were a more active body than the OFT. We will have a supervisor who we will liaise with directly, so the FCA should get a deeper understanding of how the industry works.
Sales of the tablet are set to fall again, say analysts
Met Police confirm there was a 'minor disturbance' and that no-one was arrested
George Lucas criticises the major Hollywood film studios
Does Chris Grayling realise what a vague concept he is dealing with?
Trend which requires crisps, a fork and a strong stomach is sweeping Mexico's streets
Parties threaten resort's image as a family destination
I Am Bread could actually be a challenging and nuanced title
- 1 Indian footballer Peter Biaksangzuala dies after injuring spine doing somersault celebration
- 2 Jack the Ripper: Scientist who claims to have identified notorious killer has 'made serious DNA error'
- 3 Banksy arrest hoax: Internet duped by fake report claiming that the street artist's identity has been revealed
- 4 Drink alcohol and eat meat to improve male fertility - but cut down on coffee, studies suggest
- 5 Brian Harvey turns up at Downing Street and 'demands to speak to Prime Minister'
Cameron is warned 'no possibility' of UK reducing immigration and that bid to bring in quota on migrant workers would be illegal
Residents should throw a street party and mix with immigrant neighbours, councils told
London bus driver allegedly kicks gay couple off for kissing
Russell Brand threatened with arrest after filming outside Fox News headquarters
Amal Alamuddin calls for the return of the Elgin Marbles from Britain: 'Injustice has persisted for too long'
Lord Freud: Tory welfare minister apologises after saying disabled people are 'not worth’ the minimum wage
iJobs Money & Business
£18 - 23k + Benefits: Guru Careers: We are seeking a Customer Service Executiv...
£60 - 65k + Benefits: Guru Careers: We are seeking a ASP.NET Web Developer / ....
£60,000 - £80,000: Saxton Leigh: Our client is an leading Asset Manager based...
£27000 - £32000 Per Annum: Clearwater People Solutions Ltd: Our large charity ...