Provident Financial pre-Christmas sales help profits exceed market predictions

City A.M. Reporter
DOORSTEP lender Provident Financial said 2010 results would be slightly ahead of market expectations after sales of loans strengthened further in the run up to Christmas despite disruption caused by heavy snow.

“The group had a strong finish to 2010 and expects to report results slightly ahead of market expectations,” chief executive Peter Crook said in a trading statement yesterday.

The company, which specialises in lending to people unable to borrow from high street banks, said the average forecast of 18 analysts was for an adjusted 2010 pretax profit of £141.1m with predictions ranging between £136m and £146.5m.

Provident, seeking to allay fears over the impact of government spending cuts and welfare reforms on its business, said in November that it had seen a pick up in home credit sales since September.

“This performance improved further through the peak trading weeks in the run up to Christmas, notwithstanding the adverse weather conditions,” the company said.

The lender also said its ability to collect repayments on loans had improved in the fourth quarter having been stable in the first nine months of the year while new customer growth had moderated to one per cent due to a focus on existing customers.