H&T PLC reports strong pledge loan demand in run-up to Christmas

H&T Group PLC (AIM:HAT) said trading in the second half of 2021 had been consistently strong and profits for the year would meet market expectations as a result.

Demand for pledge lending was now back at pre-pandemic levels added the pawnbroker, with November and December particularly busy.

Lending volumes in December, in particular, were ahead of expectations and at record levels.

As a result, the pledge book at the end of 2021 was up 39% to £67mln, with a 34% rise since June.

Loan-to-value ratios also had been maintained with redemption rates remaining stable, said the statement.

The group had cash balances of £17m as of 31 December and its funding facilities of £35m remain undrawn.

H&T added it is still working with the FCA, the UK’s financial regulator, on a review of lending processes, creditworthiness and affordability assessments undertaken within its high-cost short term loans business.

Chris Gillespie, H&T chief executive, added:  “The Group has performed consistently well through the second half of 2021 and I am particularly pleased by the strong demand for our pawnbroking loans. 

“We have seen higher month-on-month lending levels in each successive month since May, with a full return during the fourth quarter to pre-pandemic lending volumes and very positive momentum as we move into 2022.”

“Lending volumes and retail sales remained strong up until the Christmas break and this has continued into January. “

Consensus forecasts are for profits of between £9-10.1mln in 2021.