Pawnbroker H&T expects to beat City profit forecasts for the year just ended as a result of the rising price of gold and record lending to customers.
AIM-listed H&T said in a pre-close update that “continued success in the gold purchasing market and significantly increased profit from pawnbroking scrap” lay behind its success.
The retailer said that store openings and an increased average loan took its gross pledge book up to £39.5m at the end of December 2010, compared to £37.3m at the end of June.
H&T will also benefit from one-off working capital improvements, which will add about £4.9m to profits in the year to December 31, 2010. Like-for-like retail sales were flat year on year, the retailer said.
Traditional pawnbrokers now face increased competition in the cash-for-gold market. Grocery giant Tesco is piloting a gold purchasing scheme in some of its stores.
H&T has 135 stores and 45 Gold Bar mall units.