TIDMSUS
RNS Number : 7985O
S & U PLC
11 February 2021
Correction: Further to RNS number 6787O released earlier today,
the interim ordinary share dividend will be paid to those
shareholders on the register on Friday 19th February 2021 and not
20th February 2021. This has been corrected in the statement below.
All other details remain unchanged.
11 February 2021
S&U plc
("S&U" or "the Group")
CORRECTION: TRADING STATEME NT AND NOTICE OF RESULTS
S&U plc, the specialist motor finance and property bridging
lender, today issues a trading update for the period f rom its
trading statement of 9 December 2020 to the Group's year end on 31
January 2021. The Group's full year results will be announced on 30
March 2021.
The Group's trading remains robust and profitable, despite the
current lockdown and th e induced coma int o which the Government
has needed to place the wider UK economy. Demand by customers in
both divisions remains
strong and collections quality continues to be good.
We are planning for a significant rebound to pre-Covid motor
finance transaction levels as lockdown restrictions ease this year
, and a substantial increase in business at Aspen our property
bridging business.
Motor Finance
Transaction numbers at Advantage have held up well over the
period and, despite the closure of a number of car showrooms,
continue to improve. In the past 2 months new deal transactions
have reached nearly 80% of the comparable period last year and
rising. R ecord application numbers continue , although Advantage's
prudently responsible underwriting and affordability requirements
have seen new deal transactions for the year as a whole total
around 15,600 with customer numbers at year end of just under
63,000 and net receivable s of around GBP247m.
Advantage's industry leading customer analysis and an evolving
product range present tremendous opportunity for growth throughout
the n on-prime finance spectrum, despite the more competitive
environment.
Repayment quality remains good; Advantage's collections
department ha s always been proud of the sustainable relationships
it develop s with customers. Thus, the number of customers
remaining on payment holiday has reduced from 15,000 at the peak to
below 4,000. These relationships are also reflected in their
payment performance, and in January monthly collections improved to
90 % of contractual terms due .
More important, despite an increase in covid cases in the first
half of the period under review Advantage is keeping staff safe.
Moreover, our continuous drive for improvement has seen the launch
of initiatives on affiliate i ntroducers, product development and
customer service - the latter reflected in Advantage's latest
Trustpilot c onsumer ratings of 4.8 out of 5.0.
Aspen Bridging
Aspen continues to make great progress both in terms of growth
and quality. In a resilient residential housing market, (Zoopla's
UK house price index recently reported year on year growth of
5.9%), Aspen has seen net receivables rise from GBP 29.6 m to
around GBP34m in the period. During th is time , new transactions
have consistently beaten budget, and Aspen's deal pipeline has more
than doubled.
Experience, market credibility and sensible underwriting have
seen credit quality at its best ever, with only three of over sixty
customers slightly beyond term at year end. These promisin g trends
have justified a further GBP4m investment in Aspen over the past
two months, and the recruitment of experienced new staff in
business development and underwriting .
Funding
S&U's financial position has been strengthened still further
as borrowings have fallen to GBP 99 m from GBP103m. Gearing now st
and s at approximately 55% from 58%. This reflects continued and
seasonal cash generation at Advantage, offset b y additional
investment in A spen. GBP130m of Group facilities provide
significant headroom for growth.
Dividend
Despite t he inevitable effect of Covid-19 on S&U's
profitability, our confidence in f uture trading, our financ ial
strength and consistent commitment to shareholder reward justify a
second interim dividend this year of 25p per ordinary share (2020:
36p). This will be paid on 12(th) March 2021 to those shareholders
on the register on the 19(th) February 2021.
Commenting on the Group's performance and outlook, Anthony
Coombs, S&U Chairman, said :
"Although the return to economic and general health in the UK
will be uneven, the outlook is undoubtedly brightening. The proven
strength and experience of S&U, exemplified by our loyal and
dedicated staff, make me confident that we can grasp the tremendous
opportunities economic revival will bring."
For further information, please contact:
S&U
Anthony Coombs, Chairman 0121 705 7777
Newgate Communications
Bob Huxford, Megan Kovak, Tom Carnegie 020 7653 9848
Peel Hunt
Adrian Trimmings, Andrew Buchanan, Rishi Shah 020 7418 8900
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