S&U (LSE:SUS) reported revenue of £57.3 million for the interim period, an increase of 11% year on year, while profit before tax was broadly unchanged at £15.7 million.
Basic earnings per share increased to 96.8 pence, while net receivables rose to £541.0 million. The increase in receivables was funded partly through higher borrowings, with group gearing reaching 114%.
The specialist finance group increased its first interim dividend to 36 pence per share.
Advantage Finance Profit Rises to £11.8 Million
S&U’s Advantage Finance motor lending division reported profit before tax of £11.8 million.
The company attributed the performance to increased advances, improved customer repayments and lower impairment charges.
Advantage Finance has also introduced changes to its credit scoring processes and is using AI-enabled technology within its customer service operations.
The division provides finance primarily for used vehicle purchases in the UK.
Aspen Bridging Reports £4 Million Profit
Aspen Bridging, S&U’s property finance business, reported profit of £4.0 million during the period.
The division increased its receivables and continued to shift its lending mix towards longer-duration loans.
S&U said Aspen experienced pressure on margins and higher impairment charges during the period, against a backdrop of subdued activity in the UK housing market and economic and regulatory uncertainty.
S&U Progresses £600 Million Securitisation Facility
The group continued to expand its net receivables and said legal work on a new £600 million three-year securitisation facility was substantially complete.
The planned facility is intended to diversify the group’s sources of funding as its lending operations expand.
Management also highlighted ongoing regulatory developments affecting motor finance and the broader financial services sector.
S&U noted proposed changes concerning regulatory costs and the respective roles of the Financial Conduct Authority and Financial Ombudsman Service, although the eventual impact of these measures remains dependent on their final implementation.
More About S&U
S&U plc is a UK specialist finance company operating through Advantage Finance and Aspen Bridging.
Advantage Finance provides used vehicle financing, while Aspen Bridging provides property bridging and buy-to-let lending. The group funds its lending activities through a combination of borrowing and securitisation facilities.
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