Provident financial suffers falling profits
Doorstep UK lender Provident Financial today reported a 20% slump in pre-tax profits after it invested heavily in start-ups in Mexico and Romania and its credit card business.
However, shares in the Bradford-based firm lifted 1% after it said the outlook for UK home credit has improved.
Provident also confirmed the demerger of its international business would go ahead in spring next year.
Pre-tax profits for the six months to the end of June fell to £66m (€97.5m) from £82.9m (€122.4m) last year, Provident said. Revenue rose 5% to £569m (€840.4m).
Investment in start-up businesses and new products doubled over the period, including Vanquis Bank credit card and international start-ups
Chair John van Kuffeler said: “The medium term outlook for UK home credit has improved, with the business now delivering growth in customer numbers and credit issued.
“2006 is a year of significant investment to enhance the future growth of the group’s UK and international businesses.”
Following a step-up in marketing in UK home credit, customer numbers are growing for the first time in three years, he added.
