S & U PLC (LSE:SUS) said its motor and property businesses continue to outperform, though it remained mindful of the potential impact of political uncertainty, higher prices and slowing economic growth.
In an update covering a two-month period from its annual meeting, the finance group said receivables had increased by £30mln to £370mln.
It added that debt quality was ‘reflected in strong collection rates and supported by low levels of default’.
S&U’s own borrowings rose to £154mln from £125mln at the last announcement, on May 26. Its medium-term facility is £180mln.
While the group is performing robustly, it said it is also taking a cautious approach to underwriting against the present uncertain economic backdrop.
“Current political instability and differing views on fiscal policy, together with persistent UK economic headwinds do not allow for any complacency,” investors were told.
“We recognise that a potentially shrinking economy, higher inflation and interest rates, historically low levels of consumer confidence and a possible technical recession in the UK, have all contributed to a manically depressed view of the future, particularly in the UK equity markets.
“Hence, although growth currently exceeds budget and expectations, we judge it sensible in light of current uncertainty about economic prospects, to temper optimism with caution, particularly in our underwriting policy.
“Recent adjustments are designed to continue to ensure that our customers have sufficient comfort and headroom to withstand any pressure on their household disposable incomes, which might be felt later in the financial year.”