Profits down 33% at Albemarle & Bond
Pawnbroker Albemarle & Bond saw its pre-tax profits drop by 33% to £8.1 million in the six months to end December as the company was hit by an anticipated fall in gold buying profits.
While Albemarle’s pawnbroking profits rose 2.3% to £17. 6 million, the company ended the year with a pledge book of £38.1 million, a slight fall on the £38.3 million seen in 2012. Albemarle attributed the fall to reduced volumes of gold in circulation and increased competition.
Albemarle’s retail jewellery and product sales rose 16.7% in the period to £10.5 million with profits increasing by 32%.
However, gold buying contributed £9 million in the period compared to £12 million in the prior year due to a decline in volumes and percentage margins since April 2012.
During the half year, Albemarle completed four London store acquisitions and diversified gold buying pop up stores into a 'cash solutions' offer in 43 locations
While operating costs increased by 2.9% against a store base increase of 8%, like-for-like operating costs were 5.2% lower as a result of strong cost controls.
Chief executive Barry Stevenson said: "Profits were in line with expectations as we experienced tougher and more competitive markets in the first six months of the year and we expect these market conditions to continue in the second half.
"The investment we made to more than double our store base is delivering positive returns and the majority of the new stores have contributed an operating profit in the first half with potential for future growth.
"In the second half of the year our strategy is to continue to leverage our expanded store base in combination with our online unsecured lending offer."
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