29th Apr 2009 07:30
International Personal Finance plc
Closure of Russian market pilot
The Board of International Personal Finance plc has decided to discontinue its pilot operation in Russia with immediate effect.
Since commencement of the pilot with the acquisition of a Russian Bank licence at the end of 2007, economic trends in Russia and the world economy have combined to indicate that our roll-out plans, and our path to profit in Russia, would inevitably be slower than originally planned. The Board has therefore concluded that it would not be the best use of the Group's resources to continue with the development of the Russian market.
At the end of March 2009, the Russian pilot comprised 875 customers, £0.2 million of net customer receivables and 71 employees.
Trading losses in 2009 are expected to amount to approximately £3.0 million. In addition pre-tax closure costs of £7.8 million are expected, comprising winding-up costs of £3.7 million and the write-off of goodwill, customer receivables and fixed assets of £4.1 million. There will also be a one-off tax charge of £2.0 million relating to the write-off of a deferred tax asset.
Our new market research programme continues as planned and, when the world economy returns to more settled conditions, we will seek to take advantage of opportunities to enter new markets in line with our strategy of geographic expansion. In the meantime our focus will be on realising the significant development opportunities in our established Central European businesses and our developing markets in Mexico and Romania.
Rosamond J Marshall Smith
General Counsel & Company Secretary
29 April 2009
Contacts for further information:
Victoria Richmond - 0113 285 6873 - media
Steve Jones - 0113 285 6846 - investor relations
Related Shares:
Inter. Pers.