People walking past H&T store
H&T’s pledge book grew by 14% over the half / Image source: H&T
  • H1 pledge book growth of 14%
  • Cost-of-living crisis a boon for H&T
  • Higher-than-expected costs weigh on shares

H&T (HAT:AIM), the UK’s biggest pawnbroker, reported a 31% rise in pre-tax profits for the half to 30 June 2023 as the cost-of-living crisis drove continued positive momentum in its pawnbroking business.

The company insisted rising demand for its core products and continued momentum in pawnbroking provided a ‘robust revenue foundation for the remainder of the financial year’.

Yet the share price reaction was muted, H&T bid up 0.5% to 404p as a deliberate reduction in margins to shift slow-moving stock crimped profits in the retail watches and jewellery business, and H&T also highlighted higher-than-expected operating cost inflation.

These headwinds prompted Shore Capital to downgrade its full year 2023 earnings per share estimate by 7% to 53.9p, though the house broker increased its full year 2025 earnings estimate by 3% to 80.9p and nudged up its ‘fair value’ estimate for H&T from 580p to 620p.


The UK’s biggest pawnbroker is thriving in the current climate as cash-strapped consumers who can’t get credit from banks seek short-term loans, pledging jewellery and valuables as collateral. H&T also makes money from selling new and used jewellery, foreign currency and trading gold.

Pre-tax profits powered 31% higher to £8.8 million in the first half thanks to continued momentum in the core pawnbroking business combined with growing demand for H&T’s foreign currency service ahead of the holiday season as well as strong scrap profits.

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H&T’s pawnbroking pledge book grew by a better-than-expected 14% to £114.6 million over the half, with demand for pledge lending remaining at record levels.

The company pinned this growth on customers’ increasing need to access small sums of short-term credit at a time of reduced supply following the departure of several firms from the unsecured lending market.


The one slight disappointment was the retail business, which sells high quality pre-owned jewellery and watches.

Whilst sales increased by 11% year-on-year to £23 million with online sales at record levels, margins and profits reduced due to a change in the sales mix and actions taken to reduce inventory levels, in particular of certain watch brands.

The good news is H&T expects margins will improve rise in the second half following price increases.


Chief executive Chris Gillespie explained that after raising £16.9 million in October 2022, H&T set out its plan for ‘increased investment in the group’s operational capabilities and store portfolio to capitalise on the growth opportunity presented to the group in the medium term.’

Gillespie insisted he was ‘delighted with the progress we have made and the momentum with which we enter the busy second half of the year’, though he cautioned that H&T is ‘not immune’ to inflation and rising interest rates which have resulted ‘in operating costs being higher than previously envisaged.’

However, ‘much of this cost inflation is now factored into the cost run rate. We expect a lower level of cost inflation in the second half of the year which, alongside the growing revenue momentum of the business, puts us on track to deliver record profits in 2023.’


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Issue Date: 08 Aug 2023