Buoyant motor sales and strong Christmas trading boost credit firm S & U
THE continuing strength of the UK car market has supplied sustained growth to the auto finance arm of Solihull-based credit and finance provider S & U.
In a trading update, S&U said Advantage – its motor finance business – had not only maintained its powerful first half performance but in certain areas, particularly debt quality, had exceeded it.
“Indeed over this trading period customer numbers are at a new record and their rate of growth remains very impressive. Both the range of our products and the number of our introducing brokers has been increased; this provides the platform for further significant expansion,” it said.
In the Home Credit sector, it said that as the business entered the closing stages of the busy Christmas period trends on collections and sales were both promising.
“Debt quality has improved, credit availability for existing customers is up on last year, and recent new customer promotions have been very successful,” it said.
Recent sales and demand for new loans reflect a gradual improvement in consumer confidence, it added.
It said it regarded the recent announcement of potential rate caps for parts of the consumer credit sector, in particular pay-day lending, as benign and consistent with continued support for its home collected relationships.
Recent investment in both the home credit and motor finance businesses has seen gearing rise during the period to 41% from 31% last year.
In order to comfortably continue to finance the expansion and the consequent growth in the loan book, it has arranged an additional £15m of facilities with a new banking partner on a medium term basis.
“With our new and existing banking partners we look forward to continuing to build our business over the next few years,” it added.
Commenting on the group’s trading and its outlook, Anthony Coombs, S&U chairman, said: “Encouraging current trading and the loyalty and renewed confidence of our home credit and motor finance customers enable us to confidently anticipate the results which the hard work and dedication of everybody at S&U fully deserves.”
