Surging gold price helps pawnbroker Ramsdens to record profit
Ramsdens has delivered a record profit thanks to the surging gold price and demand for its pawnbroking services.
The retailer, which offers financial services as well as pawnbroking, told markets this morning that revenue rose 14 per cent in the year to September 30, to £95.6m from £83.8m in 2023.
Gross profit rose 13 per cent, from £45.8m to £51.5m, while profit from pawnbroking increased 16 per cent to £11.7m, from £10m in 2023.
Profit from purchasing gold increased approximately 40 per cent, Ramsdens said, due to the high price of gold since March 2024. The weight of gold purchased from Brits rose by around five per cent.
Panmure Liberum analysts said the increase in profit was driven “almost entirely” by the strong gold price.
The company recommended a final dividend of 7.6p per share taking the total dividend for the year to 11.2p per share from 10.4p in 2023.
Chief Executive Peter Kenyon said: “We are pleased with the positive momentum achieved across each of the group’s income streams, with a particularly strong performance in our precious metals segment where we continued to benefit from the high gold price.”
“The increase in sales of foreign currency indicate we are taking market share and – in its first full year of use – our multi-currency card has had a very encouraging start with opportunities for further growth in FY25 and beyond.”
“Our pawnbroking loan book continues to grow incrementally and the launch of our new Ramsdens pawnbroking website in November, following the year end, has started well and is already attracting new customers,” Kenyon added.
Panmure Liberum analysts expected “continued growth” in pawnbroking, but cautioned it would be at a slower rate as cost-of-living pressures reduce.
“While outlook appears to be improving for households, the absence of alternative short-term consumer credit providers remains a longer-term tailwind for Ramsdens,” analysts added.
Ramsdens notes a £0.8m increase in costs due to changes to national insurance payments, but said this would be absorbed by stronger trading.