S&U steps up dividend as motor finance accelerates

25th Mar 2014 10:41

Niche home credit and motor finance provider S&U hiked its dividend yet higher as its generated record profits during its 75th year.The Birmingham-based business, set up by Welshman Clifford Coombs in 1938 and chaired today by his grandson Anthony, lifted pre-tax profits 21% to £17.3m on turnover up 11% to £60.8m on the back of a strong performance from motor finance.The board proposed a final dividend of 24p, meaning the total dividend in respect of the year was increased to 54p, up 17%.Group annual collections were up over £10m on the prior year to record levels, with Home Credit stable and Motor Finance collections up 26%.Anthony Coombs pointed to a "remarkable" 42% increase in Motor Finance profits, under the Advantage Finance brand, from a 47% lift in advances this year with continuing good trends in collection quality.He added: "Prospects for growth in a market estimated at potentially 4.5m customers in the UK are signicant - particularly as the economy revives and a gradual recovery in consumer confidence takes place. Advantage will continue to develop products to continue this significant expansion, whilst ensuring that debt quality remains at its current best ever levels, as measured by collections performance."Fourth quarter loan advances in Home Credit, under the Loansathome4U brand, were up 8% on last year as two new branches opened in the year and Coombs is confident the same macro-economic trends also bode well for this business.Shares in SUS were up 2.5% at 1,892p at 11:30 on Tuesday.OH