This is one I have been a long term shareholder in and you can learn more about the Company at their website. They announced a trading statement today with extracts as follows:
"S&U, Britain's foremost home credit and motor finance provider, today issues a trading update for the period from its most recent IMS on 10th December 2013 to the Company's Year End on 31st January 2014. The Company is pleased to confirm that Group trading is in line with market expectations."
Within that trading was strong at Home collected credit being up 10% over Christmas. While the Motor Finance side continues to power ahead with customer numbers up by nearly a quarter. They still sound pretty bullish on the prospects for what has been the growth engine for them in recent years as follows:
"Customer numbers are almost a quarter up on last year at just over 18,000, while new products have attracted an additional array of introducer Brokers as well as consolidating existing loyalties; debt quality goes from strength to strength. Our ambitions for the future surpass even the achievements of the past."
They say they have invested £12 million this year to finance this growth which has taken gearing up to 46% which is still reasonably conservative for a bank / finance company.
They also increased the second interim by 2 pence to 16 pence and have paid out 4 pence more (30 v 26) so far this year which represents a 15% increase on last year. The Chairman has also suggested at least an unchanged 20 pence final which would give at least 50 pence for the year or more likely 52 to 53 pence if it is increased in line with the dividends so far. Given that earnings are forecast to be up around 18% and cover is flagged as having increased to 2 times this does not seem like an unreasonable expectation. If the dividends come through at this level, this would leave the shares on around 3% net yield.
Finally the chairman also sounded pretty positive on trading and the outlook going forward so I'll leave you with his final words:
"I am very pleased that our hard working and dedicated people throughout the Group have been able to mark our 75th anniversary year by levels of customer service that have achieved record results. As the employment market recovers, and consumer confidence returns, we view the future with enthusiasm and confidence."