Provident Finacial Group (PFG) which I wrote up in detail in January this year and after their final results in February, had their AGM and an IMS mid morning yesterday.
In this the Chairman, Manjit Wolstenholme said:
"The group has made a very good start to 2014. Vanquis Bank has continued to generate strong customer growth and margins through developing its presence in the under-served, non-standard credit card market and CCD is making excellent progress in repositioning the home credit business as a leaner, better-quality business focussed on returns rather than growth, whilst building the capability for the more rapid development of the Satsuma online instalment lending business from later this year. Credit quality in both businesses is good and the group's funding position is strong, providing confidence that the group is on track to deliver good quality growth in 2014."
In slightly more detail the Vanquis Bank saw customer numbers up 20% and receivables by 33% with a risk adjusted margin of 34%. The Polish start up continues to progress and the losses are in line with previous guidance. While on the Home collected credit side they continue to modernise these operations with Apps and tablets while reducing costs and running it for cash to fund the growth of Vanquis Bank at home and in Poland.
Overall they still seem to be on track and the shares have done well being up by more than 20% since I first wrote about them in the middle of January of this year. This leaves them on approaching 17x this years forecast earnings but still with a useful 4.6% yield thanks to the expected double digits dividend growth. If you are desperate for income they are still cum the final dividend of 54 pence until the 21st May which gives a yield of around 2.5% on it own. However, given the rise in the share price and the valuation I would expect it to pause and maybe even give a bit back from here in the short term. It does however look like a good long term hold as part of a diversified income portfolio.