Britain's largest pawnbroker, H&T, has reported robust sales that met expectations in the first half of the year, despite signs of an improving economic climate in the º£½ÇÊÓƵ.
The firm witnessed a 4% boost to its pledge book, which reflects short-term loans managed by the pawnbroker, hitting £105 million in the initial six months.
Shore Capital, an investment group, anticipates a full-year growth of about 5%, .
Speaking on the industry, Shore Capital's equity analyst Gary Greenwood highlighted that pawnbroking thrives during economic downturns, being "a beneficiary of recent º£½ÇÊÓƵ economic malaise".
H&T also recorded an uptick in the trade of watches, indicating an increase in people selling their luxury timepieces and purchasing pre-owned high-end watches at lower prices.
However, growth appears to be decelerating; H&T saw a 27% increase in revenue to £220 million for the full year 2023, as declared earlier in the year.
Pawnbrokers have seen unprecedented sales amid the cost-of-living crisis, with residents turning to them to cope with rising rents and bills.
Yet there has been no significant drop in revenue that would suggest an end to the financial difficulties faced by many in the º£½ÇÊÓƵ; H&T is projecting its 2024 performance to align with expectations while still expanding amidst a brighter economic forecast.
In terms of seasonality, H&T has experienced a slower than expected rate of redemptions, which involves customers repaying their debts to reclaim pawned items.
However, they noted that a similar pattern emerged the previous year, linked to various events such as religious festivals and weddings.
"A seasonal trend may be developing for the business," Shore Capital observed, noting a surge in redemptions in March that typically tapers off as summer approaches.
The company is set to deliver a comprehensive interim results report on August 20.
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