11th Feb 2020 10:48
(Alliance News) - Specialist lender S & U PLC said Tuesday it seen a rise in transactions in both its property and motor bridging lending units during the December and January.
S & U attributed this to a rise in consumer confidence following the UK general election.
"As a result, we expect that our full-year results will be in line with management's expectations and provide a solid platform for further growth next year," the company added.
S & U is scheduled to release its results for the year ended January 31 on March 24.
The lender said its profit slowed in 2019, but said the "consistency and sustainability" of its earnings justify an increase in its second interim dividend, rising to 36 pence from 35p.
Chair Anthony Coombs said: "Although the UK may not yet have reached the sunlit uplands of renewed growth and consumer confidence which the General Election result makes possible, S&U's prospects for the year ahead are good. From a sound financial base, S&U is very well placed to take advantage of this in our habitually responsible and sustainable way."
S & U said its motor finance unit, Advantage, remains in "robust health".
The company noted sales in the used car market remained around its long-term average in 2019 at about 7.9 million vehicles, compared to the new car market, which slipped 2.4%.
As a result, S & U said Advantage saw a record number of applications in financial 2020 of over 23,300 new agreements, up 11% on the year before.
Customer number are now at a record 64,200, with net receivables up 8% year on year at GBP280 million.
Turning to its property bridging finance unit, Aspen, S & U said the business continues to make progress.
"Although, following the general election, the uncertainty and low levels of activity in the residential property market have begun to dissipate, time lags in bridging have seen this reflected more in recent illustrations rather than in deals," S & U added.
S & U noted some borrower exits are still slower than anticipated but the company has seen the level of repayments, including late stage repayments, improving recently. As a result, S & U saw GBP15 million being repaid in the final quarter.
The company said: "Taken together, these trends reinforce our confidence in Aspen's growth prospects in a healthier property market, and therefore our confidence for further investment in the year ahead."
Shares S & U were 2.6% higher in London on Tuesday at 2,298.00 pence each.
By Paul McGowan; [email protected]
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