Credit, Collections & Insolvency News
Subprime lender, Morses Club, says its Home Collected Credit (HCC) division traded well in the 52-weeks to 26 February 2022, despite an increase in complaints submitted by claims management companies.
In its latest trading update, the business said its pre-tax profits will be up to 30% lower than expected.
The company stated that its Home Collected Credit (HCC) division traded well, despite the recently reported impact of an increase in complaints submitted by claims management companies.
Morses said it constantly monitors its credit policy to keep it aligned to market conditions and some tightening of criteria has ensured the quality of lending is maintained. Customer numbers of 143,000 (FY21: 151,000) at the end of the period are a strong indicator of consistent demand. Total credit issued during FY22 was £108.0m, 9% above management’s budgeted plan and just marginally lower than the previous year (FY21: £109.7m). The gross loan book was £96.7m (FY21: £102.1m). Cash collection performance for the HCC division has remained strong and is ahead of management’s budgeted plan.
The Group continues to adapt to a structurally changing HCC sector influenced by changing customer and regulatory needs; 66% of all lending is now cashless, while 87% of payments are cashless. This is consistent with FY21, despite the easing of Covid-19 restrictions. 81% of customers are signed up for the customer portal, which has increased by 8% compared to FY21. Impairment for the financial year is expected to be lower than the Company’s guidance range.
Gary Marshall, Chief Executive Officer, said “I am very pleased to have been appointed CEO of Morses Club at such an important and transformational time in the business’ history. I am very encouraged by the performance of the Group over the period. We have traded profitably, with a renewed focus on delivery and enhancing our customer experience. Our digital expertise gives us the ability to adapt to the continued change in customer and regulatory demands in both the Digital and HCC divisions.”
“The HCC business has traded strongly, with proven levels of adaptability which we will continue to mould to our customers’ needs over the coming years. I look forward to providing the group with a renewed focus on transforming the business to deliver sustained growth for both divisions.”
Sir Nigel Knowles, Chairman, said “Having served on the Board of Morses Club for a number of years, I am delighted to take up the role of Chairman. The underlying trading performance of the business is positive and the reshaped leadership team will give added impetus to the growth plans of the business that will ensure continued focus on delivering for our customers, shareholders, employees and agents.”