Skip Header
Important information: The value of investments can go down as well as up so you may get back less than you invest. Investors should note that the views expressed may no longer be current and may have already been acted upon. This is a third-party news feed and may not reflect Fidelity’s views.

S&U revenue up, profitability a challenge in first half

(Sharecast News) - Motor and property finance specialist S&U reported a mixed first-half financial performance on Tuesday, after group revenue increased 9% year-on-year to £60.4m. The London-listed company said profit before tax fell to £12.8m, from £21.4m in the prior year, partly driven by a £2.8m rise in finance costs, reflecting higher borrowings and increased interest rates.

Its net receivables grew to £475.4m, up from £417.3m a year earlier, while group equity increased marginally to £233.4m.

S&U announced a first interim dividend of 30p per share, down from 35p in the first six months of the 2023 financial year, and reported a rise in group gearing to 103%, up from 80% the previous year.

Advantage Finance, S&U's motor finance arm, saw revenue rise to £49.1m, but profit before tax dropped significantly to £9.4m from £19.1m a year ago.

That was largely due to an increase in impairment charges, which surged to £18.1m from £6.8m, while its collection rate fell to 87% from 94% in the prior period.

Net receivables for Advantage Finance stood at £326.2m, largely stable compared to earlier periods.

Aspen Bridging, the group's property finance division, reported strong revenue growth, reaching £11.2m, up from £7.9m in the first half of 2023.

Profit before tax for Aspen rose to £3.4m from £2.4m in the same period last year.

Net receivables grew to £149.3m, up from £104.3m a year earlier, supported by collection repayments and recoveries of £72.8m.

Overall, while S&U's revenues increased, the group faced profitability challenges in its motor finance business, impacted by rising impairment charges and higher finance costs, offset by a solid performance from its property finance division.

"Half-year results for Advantage reflect a temporary adjustment to shifting market dynamics and evolving regulatory expectations," said chairman Anthony Coombs.

"Nevertheless, the resulting internal reforms should provide greater certainty for renewed success.

"Meanwhile, in the more dynamic bridging sector, Aspen continues to perform strongly.

"We embrace the future with our usual cautious optimism."

At 1038 BST, shares in S&U were up 5.71% at 1,754.75p.

Reporting by Josh White for Sharecast.com.

Share this article

Related Sharecast Articles

Thames Water creditors seek support for £1.5bn rescue fund
(Sharecast News) - A coalition of Thames Water's creditors was reported to be seeking additional investors to support a £1.5bn rescue fund on Monday, aimed at stabilising the troubled water utility and sustaining its operations through to next October.
Zahawi reportedly helping Dovid Efune in £550m Telegraph bid
(Sharecast News) - Former Conservative chancellor Nadhim Zahawi is actively engaged in efforts to support a £550m takeover of the Daily and Sunday Telegraph led by Dovid Efune, a New York-based media investor and current proprietor of the New York Sun, it was reported on Monday.
Croma Security Solutions reports solid final results
(Sharecast News) - Croma Security Solutions Group reported solid financial results for the year ended 30 June on Monday, with group revenue rising 8.9% to £8.74m, after the first full year under its new strategic direction.
Zotefoams confident in meeting full-year expectations
(Sharecast News) - Zotefoams reported a robust trading performance for the first nine months of the year on Monday, with year-to-date sales ahead 23% at £110.7m, compared to the same period last year.

Important information: This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice. When you are thinking about investing in shares, it’s generally a good idea to consider holding them alongside other investments in a diversified portfolio of assets. Past performance is not a reliable indicator of future returns.

Award-winning online share dealing

Search, compare and select from thousands of shares.

Expert insights into investing your money

Our team of experts explore the world of share dealing.