Shares in leading pawnbroker H&T (HAT) leapt 11% higher to 299.4p on Monday after the company said it expected full-year pre-tax profit for the period ended 31 December to be ‘ahead of market expectations.’

STRONG TRADING

Almost all 235 stores remain open as they are categorised by the government as essential services. Stronger than anticipated trading in the last two months of the year prompted today’s upgrade.

According to data collated by Refinitiv analysts had pencilled in pre-tax profit of £13.35 million. The wording used by H&T suggests a 5%-to-10% beat to that forecast.

Numis duly raised its pre-tax profit forecast this morning by 30% from £11 million to £14.2 million, although it has left future years forecasts unchanged.

RESILIENT TRADING

Strong retail jewellery sales in December meant the last six months to December sales were only 6% below the prior year. Customers continued to trade through the company’s click and collect and delivery services as the e-commerce websites were unaffected by the restrictions.

Despite travel restrictions foreign currency income was said to be ‘remarkably robust’ achieving 65% of prior full year levels.

Meanwhile Western Union transaction volumes were more than three-times higher than last year. The higher gold price resulted in precious metal scrappage rising 58% year-on-year.

New chief executive Chris Gillespie commented, ‘I have joined H&T in a strong position. We have ended 2020 robustly with an outturn ahead of expectations, showing the strength of the Company in these challenging conditions.’

Numis said: ‘The stability through 4Q demonstrates once again the resilience of the model, while H&T’s unique scale and strong balance sheet leave it well-placed to continue on its long-term growth plan.’

READ MORE ABOUT H&T HERE

Find out how to deal online from £1.50 in a SIPP, ISA or Dealing account.

Issue Date: 25 Jan 2021