Pawnshop H&T raises £17m to open more stores as cash-strapped Britons pledge valuables in exchange for loans
- H&T plans to open 20 more new stores in 2023
- Pledge book increased by 78% to £89.6m between end of June and end of August
- Equity placement for institutional and retail investors at 425p was ‘oversubscribed’
Britain’s biggest pawnbroker, H&T, has raised £17million from investors to expand its business amid growing demand from customers struggling due to the cost of living crisis.
Company boss Peter McNamara said they would use the funds raised to expand its ‘pledge book’ and open more stores ‘in a careful and measured way’.
It comes as this summer H&T said the level of ‘pledge lending’ – where customers borrow money for valuables including watches and jewelery – was at an all-time high.
H&T said a revenue squeeze has seen more customers borrow money for valuables
Demand has continued to rise since, with H&T’s pledge book at £89.6m at the end of August, up 78% from £50.2m at the end of June.
Bosses said the strong demand was the consequence of both a reduction in the number of lenders offering short-term credit and the squeeze on disposable income.
“Current market conditions are encouraging for us given the reduction in the number of lenders offering small sum short-term credit and increasingly the impact on disposable incomes from inflationary pressures,” the chief executive said. McNamara.
“This demand is not expected to decline in the short to medium term,” the company added.
This demand should not weaken in the short or medium term
It recorded “consistently high sales throughout the summer” and plans to open 20 additional new stores in 2023 to support growth.
H&T announced the placing of the share priced at 425p last night and today said it had been oversubscribed.
The total number of new shares represents approximately 10% of the group’s total share capital.
It has raised funds from institutional investors, as well as retail investors through the PrimaryBid platform.
AIM-listed H&T shares fell 0.4% to £4.36 in morning trading on Friday.
