Welcome boost for Cattles

SUB-prime lender Cattles has revealed cash collection in its main Welcome Finance arm has been in line with expectations but has reiterated to shareholders that the group’s shares have “little or no value”.

The beleagured Yorkshire firm, which last week revealed its long-delayed audited 2008 results which showed pre-tax losses of almost £750m, said Welcome collected £145m in loans from customers over the first three months of this year.

In an interim management statement Cattles, which is winding down its loan book, said it would announce its 2009 results in the “near future” but warned it would be reporting a “significant loss”. 

It said its Shopacheck and The Lewis Group brands had made “satisfactory starts” to 2010.

Cattles has confirmed that 382 staff will leave the Welcome business as its loan book is collected out, while a further 155 have received notice they are at risk of redundancy.

Cash collections at Welcome since the first quarter of 2010 have been as expected, but £1.1bn is still outstanding, compared to £2.2bn in December 2008.

Shopacheck, which provides short-term home collected loans through a nationwide branch network, continues to lend to new customers. 

Its cash collections for the three months ended March 31 were £38.5m.

The Lewis Group, a UK leader in debt recovery and investigation services, has refocused its strategy on contingent debt collection and by the end of 2010 its commitments to acquire further debt will have been completed. Debt purchases over the first quarter were £5.5m.    

Cattles said it was in discussions with representatives of its key financial creditors in order to progress proposals for a consensual restructuring.

The group has been hit by accounting failures, which meant bad debts were not properly accounted for. It has dismissed a number of executives over the matter and has been forced to sell Cattles Invoice Finance for £70.4m.