H&t Share Discussion Threads

[scotches] 06/3/2013 11:43

OFT review says entire payday loans sector has problems, with lenders' revenues heavily reliant on customers failing to repay their loans on time.

[mikey34] 07/1/2013 17:13

Quite happy with the update.....I think the mkt has been pricing in quite a dip in gold price and then a subsequent fall because of our exposure to it.The fact is the pawn business is still the driver here,and everything on that front looks fine.Undervalued on that pe.

[cutlosses] 07/1/2013 16:56

Update today.

A nice increase to the share price (plus 5%).

Lets hope the share price now settles over the £3 mark

[gwatson56] 24/12/2012 10:05

I am anticipating an update post lunch today.... Suspect some parts doing very well other parts average .... share price should be steady ... Hopeful that 2013 is a good year for HAT

edit : Ah well must be next week .....

edit 7/1 .... steady as she goes then.... share price should be supported sub £3 ... I assume market expectation are what are reported in Digital Look....

31-Dec-12 Rev (129.76) PreTax (16.38) EPS (32.65p) PE (8.7) Div (11.16p) Yield (3.9%)

Better than I get at the Post office ..... GLA

[cutlosses] 13/12/2012 16:37

Thank you for the useful summary Scotches.

Notice a large buyer late today.

[scotches] 12/12/2012 16:39

The Chancellor has promised an extension of austerity and thereby perfect conditions for pawnbroker growth in the UK until 2018. Despite that the share price of HAT and ABM continue to decline caused by a reduction in gold profits and the assimilation of new stores.

Stokopedia has a "rolling pe" for ABM of 9.47 and HAT of 7.66. You can pick up 9.75p from ABM when it goes ex-div on the 24th. Dividend announcements will probably be a useful guidance on how the companies really view future prospects.

The poor public regard for payday loans is also a negative for sentiment. Assuming the two majors are not involved in any sharp practice then more robust legislation and a shakeout of the sharks would be positive.

[scotches] 28/11/2012 22:35

...the government has agreed to change the law to give the new Financial Conduct Authority (FCA) powers to set a cap on exorbitant interest rates charged on payday loans.

[cutlosses] 28/11/2012 21:43

Thanks for the interesting link.

At todays price ( 272P) the yield is nearly 4% and has steadily increased.

I agree that "this is a rare share in the current market".

[exv] 22/11/2012 14:05

I've bought into HAT for my online portfolio today after a slight reassessment of how things are doing.



See full post above; the basic premise is that, while I don't trust the stream of profits from gold, it has certainly allowed the company to grow far more rapidly than it would have otherwise. Management seem to be bearish on the gold profits (as they should be) but are using the opportunity well. More traditional revenue streams are increasing, and will increase further as the stores mature - there'll be a big lump in the next few years as their rapid growth works through.

Even if you're not bullish on HAT's prospects, this is a great share for a number of portfolios IMO. HAT's price, to me, implies pessimism in the trends for pawnbroking - a scenario that will only occur if the general economy picks up pretty rapidly. This makes it a rare share in the current market - cheap looking while being (potentially) negatively correlated with wages/economic growth etc.

[cutlosses] 09/10/2012 18:08

I have been interested in the series Cash Britain about Pawnbroking and continue to hold this share with no end of the recession in sight. The series highlighted the role of pawnbroking in a modern society and how even small businesses sometimes use a pawnbroker.

The Dividend effectively pays investors to wait for some growth but good to see the share price settling over 300p and good to see some more interest in this thread.

[eggbaconandbubble] 09/10/2012 12:32

There was mention at the week-end of gold going to $2400 next year.
That may help both ABM and HAT

[scotches] 09/10/2012 11:52

A possible revisit of 350+ levels soon?

The austerity conditions are mooted to persist till 2020.

The government will initiate new welfare cuts.

Gold price around 11 month highs.

The payday loan OFT crackdown should actually help firms with better reputations - which you would presume would be HAT, ABM.(search "OFT crackdown on payday lenders" in google to view FT article)

[cutlosses] 22/8/2012 15:15

I don't like net debt increasing and profit decreasing but they say the core business is doing well.

At least they are looking after the shareholders by increasing the dividend.

The end of the recession seems some way off and as this is a business that benefits from a recession I will be holding for the time being.

[scotches] 22/8/2012 13:57

The H1 figures show that the company's pledge book was up year-on-year and with pawnbroking its lead service, its pawn service charge increased 11.4% to £14.7m, compared to H1 2011's £13.2m.

The group's net debt climbed to £34.2m while its profit before tax was £7.5m, down almost £3m compared to 2011, owing to its increase in new stores and store fit-outs. It also said that an increase in competitors in the gold buying market has levelled out some of its profits.

The group has opened 13 new stores in H1 and acquired two stores taking the total store estate to 175 as at 30 June. H&T also acquired three further sites and has agreed leases on six more. It has also launched Western Union services as an additional product in-store.

John Nichols, H&T group's chief executive, said: "In line with expectations, year-on-year profit before tax has fallen due to the costs of the store expansion programme and competitive pressure on gold purchasing margins.

"The board has always expressed its view that the high level of profits from gold purchasing has been a short term opportunity rather than a core earnings stream. The group's core pawnbroking operations continue to perform strongly and I am pleased to report double digit year-on-year growth in both the group's pledge book and the group's largest income stream, the pawn service charge."

Pawnbroking now accounts for three-quarters of H&T's group gross profit, something it says has helps the group's outlook remain positive.

[scotches] 07/8/2012 17:06

H&T Group plc, the UK's leading pawnbroker by size of pledge book, will be announcing its interim results for the six months ended 30 June 2012, on Tuesday 21 August 2012.


On June 21 they issued the pre-close update

"H&T Group plc ("H&T" or "the Group"), today issues a trading statement ahead of entering its close period prior to the announcement of its interim results for the six months ended 30 June 2012. H&T expects to report its interim results for the six months to 30 June 2012 on 21 August 2012.

The Board expects a good first half trading performance and to deliver full year profit before tax in line with current market expectations."

[scotches] 04/7/2012 12:02

A recent post mentioned a broker suggesting a switch between ABM in favour of HAT.

His timing was poor - however the idea of switching between the two might have some merit. With 20/20 hindsight he should have tried it in March with ABM at 362 and HAT at 289.

There have been frequent crossovers between the two share prices since HAT was listed in 2006.

If you had just stuck a flat £1000 in each (ie £2000 total) in 2006 then it would be worth about £2800 now.

However if you had switched every time one got say 50p higher than the other you would be sitting on £4600 of ABM shares after the most recent switch at the end of last month.

Of course if the comparitive revaluation in favour of HAT ever sticks the switching idea is scuppered.

[scotches] 22/6/2012 08:59

The Times Tempus has an article about HAT trading update from yesterday quoted on 3i discussion thread.


Maybe just the ticket - for now

Martin Waller: Tempus Published at 12:01AM, June 22 2012 The Times

It is all a bit of a mystery. Late last week Albemarle & Bond put out a profit warning that suggested previous breakneck expansion in the value of gold the company buys had slowed from about 50 per cent a year to "middle single digits". The company said that it was unsure whether this was down to the appalling weather keeping customers away or the start of a genuine trend. In any event, it would not hit City consensus profit forecasts for the current year.

Now along comes H&T, the other quoted pawnbroker, to say that while margins have been squeezed because of a fall in the gold price, underlying volumes have remained constant over the past 12 months and there was no noticeable fall-off in April and May.

The companies are of a similar size. Set aside some bizarre meteorological effect, and it is not easy to see what is happening. H&T has always been rather less bullish over the prospects for gold, taking the view that any such profits can best be seen as a one-off. Indeed, most of its 55 small stand-alone GoldBar units are held on short leases and can be exited at will.

Analysts wonder whether Albemarle had been a little too optimistic in factoring in further growth in gold and had therefore had to haul back City expectations. Gold has been something of a bubble, which started inflating three years or so ago as people realised that the soaring price of the metal meant that gewgaws tucked away unnoticed in a drawer might be worth something.

H&T's profits before tax hit £26.8 million in 2010 on the back of that bubble; the company yesterday reassured the market that it was in line to meet current market expectations of up to £17 million in the current year.

Pawnbroking is, sad to say, one of the few booming areas on the high street. H&T has added 14 new stores already this year, to bring its estate to a total of 174, with ten or more in the pipeline. The value of its pledge book, the amount of goods handed over by customers, is growing at a double-digit percentage rate.

Like-for-like sales at its stores, almost entirely of jewellery and fancy watches not redeemed, were off by 11 per cent year on year, reflecting consumers' understandable caution about parting with money for such goods, but those new stores meant that actual retail sales were up by 7 per cent.

Although the two share prices have tracked each other, H&T shares have tended to be lower rated than those of its rival. They sell on 8.4 times this year's earnings - fair value, though the pace of profits growth looks slow.

[scotches] 18/6/2012 12:30

The inventory levels are listed in the balance sheet of the annual report - linked above.

[beefeater25] 17/6/2012 22:19

If we were to value this business on its approximate holdings of precious metals eg gold and silver, is there anywhere we could get that info?

[scotches] 15/6/2012 13:26

And we're back to the thought which seems to be shared by many that these shares are just one almighty punt on the gold price - thereby ignoring the underlying profitable business.

btw: if the Peel Hunt guy has great insight surely the time to recommend the switch was recently when ABM was 50p higher than HAT.



Nick Batram at Peel Hunt cut his recommendation on the business from buy to hold, saying:

The question is whether the downgrade is driven by weather, consumer sensitivity to the gold price or overly ambitious expectations by management. It is possible that the weather has had an impact, but Albemarle's management has always been more bullish on gold buying than [rival] H & T. At the current point it feels as though a big component of the downgrade is due to aggressive forecasting.

We still like the underlying dynamics of the pawnbroking industry, but sentiment is likely to be weak for some time. On balance we would switch to H & T.

[outsizeclothes.com] 15/6/2012 09:23

Abermarle & Bond's update today has a pretty negative read across for H&T. [imho]
"The recent marked slowdown in gold buying activity, combined with a lower prevailing sterling gold price, has had an immediate impact on both volumes and margins. Whilst revenues have still grown in this period, this has been at a level below our expectations "

[scotches] 03/6/2012 16:28

Wonga mulls US flotation with £1.46bn value



Group accounts for the year to December 2010, the most recent at Companies House, show a profit before tax of £16.6m on sales of £73.8m.

Placing a likely valuation on Wonga is difficult but can be estimated based on the multiples attached to LinkedIn at its float in May 2011. The networking website was valued at 20 times historic sales. On the same basis, Wonga would be worth as much as £1.46bn.

[mikey34] 30/5/2012 08:19

hereagain,
True to your name you.re here again with the same mining co ramp as the other day.This thread is about HAT,so try to at least restrict your pump and dump tactics to mining co threads.