Trading Statement

RNS Number : 0544B

S & U PLC

11 February 2011

 



11th February 2011

S&U plc

(S&U" or "the Company")

YEAR END TRADING UPDATE

S&U, Britain's foremost niche home credit and motor finance provider, today issues a trading update for the period from the period from the most recent IMS on 10th December 2010 up to the Company's Year End on 31st January 2011. The company is pleased to announce that it is trading well and that results are in line with market expectations.

S&U will announce its results for the year ending 31st January 2011 on 23rd March 2011.

Home Credit

Despite a chilly climate both meteorologically and in consumer confidence, our home credit division traded well over Christmas and January. The loyalty of our customers, the quality of the weekly service we give them and the increasing popularity of our flexible and convenient loan products has given us a strong platform for further progress in the coming year.

Whilst our debt quality continues to strengthen and our home credit remains highly cash generative, we are putting in place measures to further extend the range of our customers with whom we regularly do business, thus driving the productivity of our long-serving representatives. I pay tribute to the way in which they coped, and indeed prospered in, the Arctic conditions we experienced over Christmas.

Motor Finance

At a time of year traditionally associated with a lull in the used car market, Advantage again bucked the trend to produce two months of trading more than matching the exceptional results it has achieved this year. By extending both the range and quality of its customers, Advantage has squared the circle of rising customer numbers, strong gross margins, continued cash generation and record profitability. Its extraordinary performance is a tribute to dynamic leadership and a focused and dedicated team.

Funding and Treasury

Even as the financial markets continue to be uncertain, we are pleased to report once again S&U's strengthened treasury position. Group borrowings have been reduced by nearly £5m since the end of last year. Gearing is now below 50% against 72% two years ago. As a result S&U has the financial strength to power its organic and acquisitive expansion for the foreseeable future.

Dividend

In view of our trading performance and strong treasury position, the Board has confirmed its intention, stated in our half year announcement, to approve the payment of a second interim dividend of 10p per ordinary share on the 18th March to holders on the share register on the 25th February. It is also our intention, subject to unforeseen circumstances, to recommend paying a final dividend on the 10th June 2011 of not less than 15p per ordinary share for the year ending 31st January 2011.

Commenting on the Group trading and outlook, Anthony Coombs, Chairman of S&U plc said:

"Both our current trading and plans for the future confirm my "cautious confidence" of two months ago.  The current performance of the Group augurs well for S&U's future profitability and the returns we continue to make to our much valued shareholders".

For further information, please contact:

S&U plc www.suplc.co.uk 

Anthony Coombs, Chairman                                                                        0121 705 7777

Financial Advisers, Sponsors and Brokers

Fred Walsh/Jamie Cameron                                     Arden Partners           0207 614 5917

Media and Investor Relations

Will Swan/ Rebecca Whitehead                               Smithfield                   020 7 360 4900

 

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