Provident announces profit increase

Provident Financial has announced its preliminary results for the year ended 31st December 2019 with Group adjusted profit before tax up 1.6% to £162.6m (2018 (restated): £160.1m), as the business continues to adapt to the evolving regulatory environment and successfully defended the hostile NSF bid.

Malcolm Le May, Group Chief Executive, said “I am pleased with both the group’s operational and financial performance in 2019 and the momentum behind our strategic initiatives as we enter 2020. We have delivered an increase in profits as we have continued to adapt our businesses and culture to changing customer needs and the evolving regulatory environment.”

“As a result of our good progress and the group’s strong funding and capital positions, the Board proposes a final dividend of 16.0p per share, which represents a 150% increase in the total dividend in 2019 and a dividend cover of 1.9 times as we progress towards our dividend cover target of at least 1.4 times.”

“All of our businesses have progressively tightened underwriting over the last two years and we have built good momentum entering 2020 as we continue to adapt the group to the evolving regulatory landscape and to meet our customers’ needs. We are making good progress towards the medium-term financial targets set out at our Capital Markets Day in November.”

In parts of the group, Vanquis Bank’s profit before tax slipped 9.1% to £173.5m, reflecting previously guided reduction in ROP income, Provident division Moneybarn’s profit before tax rose 10% to £30.9m as demand for used cars remained robust.

The group serves 2.3 million customers and its operations consist of Vanquis Bank, Moneybarn and the Consumer Credit Division (CCD), comprising Provident home credit and Satsuma.