30th Jul 2014 10:29
LONDON (Alliance News) - International Personal Finance PLC Wednesday said its interim pretax profit declined by more than half as higher impairments and a GBP22.6 million charge on the buyback of EUR190.2 million of Eurobonds at a premium to par value combined to more than offset an increase in revenue.
In a statement, the home credit business said it made a GBP24.5 million pretax profit in the six months ended June 30, compared with GBP54.7 million in the corresponding period last year. Revenue increased by GBP33.8 million to GBP394.1 million but impairments rose by GBP21.8 million to GBP130.2 million. A GBP5.3 million increase in administrative expenses more than offset a GBP300,000 decrease in finance costs, the company added.
On an underlying basis, which excludes the Eurobond buyback charge, International Personal Finance reported an 11% increase in pretax profit to GBP47.1 million. The company, which operates using the Provident brand in Poland, the Czech Republic, Slovakia, Hungary, Mexico, Romania, Lithuania and Bulgaria, said that the underlying figure took a GBP3.9 million hit due to weaker foreign exchange rates.
"We are making good progress on our journey to grow the business and our strategy continued to deliver strong levels of growth and profit in the first half of the year," Chief Executive Gerard Ryan said in a statement.
"I am also very pleased to announce our entry into Spain - a market which offers an exciting opportunity to add significant scale to our business in Europe. There are heightened regulatory challenges and increased competition in many of our markets but we are confident of achieving further growth and improved returns to our shareholders," Ryan said.
The company said that it expects investment in Spain to be around GBP3.0 million in 2014 and a further GBP8.0 million in 2015 with targeted break-even in 2018. New market entry cost GBP4.8 million in the first-half of 2014.
International Personal Finance increased its interim dividend to 4.2 pence per share from 3.8 pence.
Shares were Wednesday quoted down 3.8% at 563.50 pence.
By Samuel Agini; [email protected]; @samuelagini
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