North East pawnbroker Ramsdens has hailed a resilient performance despite seeing pre-tax profits tumble from more than £9.2m to £564,000.
Middlesbrough based Ramsdens - which has more than 150 stores around the UK - has posted full year accounts for the year ended September 30 2021 showing a fall in turnover from £72.5m for the previous 18 months to £40.7m.
Operating profit also fell, from £10.02m to £1.04m, and total comprehensive income was £366,000, down from £7.1m in the prior period.
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But the firm – which operates in pawnbroking, foreign currency exchange, the buying of precious metals and selling jewellery – said the previous 18-month period had included a very strong period of trading, before the pandemic struck.
Despite challenging trading conditions caused by Covid-19 restrictions, the firm remained in profit, continued investments in its long term growth opportunities and had a strong year-end balance sheet with net cash of £13m. The group’s revolving credit facility of £10m also remained undrawn.
The group kept almost all stores open through the retail lockdowns and received £1.6m of Government support during the year, including £1.5m through the furlough scheme to assist in retaining jobs.
Investment in the group’s online retail jewellery operation led to online sales more than doubling year on year, but it said its foreign currency exchange volumes were significantly impacted by travel restrictions, which were tougher in summer 2021 than in summer 2020. As a result, foreign currency income was more than £10m lower than pre pandemic levels, falling from £14.9m to £3.4m.
Chief executive Peter Kenyon said: “We are pleased to have delivered a resilient performance despite the difficult trading conditions experienced.
“We remain committed to our long term growth strategy and are pleased to have delivered on some key operational objectives, namely: doubling the jewellery sold through our website; expanding geographically into the South East; relocating stores where appropriate and investing in our jewellery offering with over 1,000 premium watches now available.
“We have had to be patient about the return of our foreign currency volumes as we have no control over the international travel restrictions imposed, but we are confident that as international travel returns our foreign currency income will grow.
“With people not going on holiday they have had cash in their pocket and our retail sales have done phenomenally well, both in-store and online - 70% up in the last quarter online, 30% up year on year in retail in the stores after the year end."
Looking ahead, Mr Kenyon said Ramsdens has been investing in its online offering, using Middlesbrough-based digital specialist Aero Commerce to power its website, and Newcastle agencies to focus on its SEO and pay-per-clicks.
He said the 2022 financial period has so far been a “transitionary period” but that further expansion into the South East, which began last year with the opening of a store in Chatham, would continue.
He said: “We’ve got offers in on three towns at the moment, one of which has been accepted, so there will be more stores down there in the coming months and we’re recruiting into our e-commerce team to grow that. Those two areas are very positive in terms of expansion.”
Mr Kenyon added: “Our staff have continued to be fantastic. I have great pride in the service levels that the team have delivered throughout the pandemic despite all the challenges faced. I would like to thank them for their dedication, passion and hard work.”
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