Impressive half-year results from niche specialist finance provider S & U (LON:SUS) received a one-off £50.5mln boost from the disposal of its Home Credit division.
The company, now focused on the financing of motor vehicle purchases through its Advantage division, confirmed it would be paying an exceptional dividend of 125p per ordinary share following the sale of its Loansathome4U business, which will augment the half-year dividend, which has been raised by 18% to 20p from 17p in the first half of last year.
Profit before tax from continuing operations rose 32% to £8.8mln from £6.7mln the year before, while revenue rose 20% to £20.4mln from £17.0mln.
Statutory profit before tax, which includes profit from discontinued operations, rose to £60.6mln from £8.86mln last year.
Advantage Finance notched up record profits of £9.7mln, up from £7.7mln in the first half of 2014. Over the same period, profit in the now sold Home Credit division fell 11% to £4.1mln, albeit from record levels in 2014.
The results clearly justify the decision to focus on the faster growing motor finance business, even if it does bring to an end S & U's long association with what used to be called "doorstep lending".
Active customer numbers at Advantage have reached over 27,500, an increase of 22% on a year ago. There was a slight dip in new transactions earlier this year, but deal volumes have now recovered strongly, S & U revealed, to the extent that budgets for the year have been revised above the growth originally envisaged.
Current trading is excellent, the group revealed, and following the sale of its Home Credit business it has the fire-power to continue to grow the business.
"The past six months has seen momentous change in the development of S & U," said Anthony Coombs, chairman of S & U.
"The sale of our traditional home credit business was both net asset enhancing and strategically desirable. It gives us a very strong base on which to continue to build Advantage Finance, our motor finance division and to explore other similar high growth areas of speciality finance," Coombs added.
Shares in S & U. up 28% year-to-date in a falling market, were up 4.25 at 2,500p in early trading.