Provident Financial delivers profit turnaround amid takeover battle

Provident Financial has claimed it has made “immense progress” after it revealed a big turnaround in its financial performance.

The Bradford-based subprime lender is currently trying to fight off a takeover from Non-Standard Finance (NSF), which has launched a £1.3bn for the stock market-listed business.

Provident Financial’s adjusted pre-tax profits significantly increased, up 82% to £153.5m in 2018. It also declared a nominal dividend of 10 pence per share for 2018.

Malcolm Le May, Provident’s group chief executive, said: “Today’s results are testament to the immense progress that the Group has made over the past 18 months.

“We have delivered against each of the objectives we set ourselves for 2018 and have strengthened our relationship with our customers, regulators and other stakeholders. We aim to build on the considerable momentum within the Group in 2019 and beyond.”

In February NSF revealed it was looking to acquire Provident Financial to “create a market leader in the non-standard finance sector”. The company valued each Provident share at 551 pence and the entire share capital at £1.3bn.

Earlier this week, NSF officially proposed the takeover bid to shareholders of Provident, giving them a deadline of May 8 to make a decision.

Le May added: “We continue to believe that the offer made by NSF is not in the interests of all shareholders.”

The board of Provident has previously voiced its concerns over “operational and execution risks” due to what they identify as the changing regulatory environment, NSF’s track record of value destruction and NSF’s limited experience across all of Provident’s businesses.

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