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Trading statements

S&U Plc trading satisfactorily

21 May 2015 07:43

S&U said group trading continues to be satisfactory. Advantage Finance, its motor finance business, maintains record debt quality and anticipates meeting transaction targets this year.

"Whilst sales in our home credit business have reflected a more cautious climate prior to the General Election and full Financial Conduct Authority ("FCA") authorisation, weekly collections remain strong on conservative underwriting standards," the company said.

"Cash generation remains good in both businesses and overall Group profitability is comfortably ahead of last year.

"Increased cash generation from our home credit business has partly off-set a lower year on year investment in our maturing motor finance business.

"Hence current head room remains substantial, and allows the continued expansion of our motor finance business to meet an expected increase in summer and autumn demand particularly following the General Election.

"This strong treasury position has been buttressed during the period by the confirmation of further medium term facilities from HSBC, our principal bankers.

"Nevertheless, to achieve our objective of diversifying long-term funding, we are in constructive and continuing negotiations with both the Prudential Regulatory Authority ("PRA") and Financial Conduct Authority ""("FCA") with a view to obtaining a Deposit Taking Licence.

"Our Home Credit business has been preparing its application for full FCA authorisation. We anticipate that the FCA will adopt a proportionate and co-operative regulatory approach and that the preparations made for authorisation will further improve the quality of our customer service and the operational efficiency of our representatives.

"Advantage Finance will similarly embark on an application for full authorisation early next year and looks forward to continuing a positive and pragmatic relationship with the Regulator."

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Related Company: SUS

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