Pawnbroker H&T raises £17m to open more stores as cash-strapped Britons pledge valuables in exchange for loans
- H&T is looking to open up to a further 20 new stores in 2023
- Pledge book increased 78% to £89.6m between end of June and end of August
- Shares placing for institutional and retail investors at 425p was ‘oversubscribed’
Britain’s biggest pawnbroker H&T has raised £17million from investors to expand the business amid rising demand from customers struggling due to the cost of living crisis.
The company’s boss, Peter McNamara, said they will use the funds raised to grow its ‘pledge book’ and open more stores ‘in a careful and measured manner’.
It comes as this summer H&T said the level of ‘pledge lending’ – where customers borrow money against valuable items, including watches and jewellery – was at a record high.
H&T said a squeeze on incomes saw more customers borrow money against valuable items
Demand has continued to rise since, with H&T’s pledge book at £89.6million at the end of August, up 78 per cent compared to £50.2million at the end of June.
Bosses said strong demand was a consequence of both a reduction in the number of lenders offering short-term credit and the squeeze on disposable incomes.
‘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 upon disposable incomes of inflationary pressures,’ chief executive McNamara said.
‘This demand is not expected to abate in the short to medium term,’ the company added.
This demand is not expected to abate in the short to medium term
It saw ‘consistently strong sales through the summer’, with pre-owned jewellery and watches among the most pawned objects.
This market ‘remains an attractive growth segment of the overall jewellery market,’ the company said.
In light of strong demand, it is looking to open a further 20 new stores in 2023 to support growth.
H&T announced the share placing at the price of 425p last night and today said it had been oversubscribed.
The total number of new shares represents approximately 10 per cent of the group’s total share capital.
It raised the funds from institutional investors, as well as retail investors via the PrimaryBid platform.
AIM-listed H&T shares were down 0.4 per cent to £4.36 in morning trade om Friday.