£202m market cap

1665p last close

S&U’s Advantage motor finance business lends on a simple HP basis to lower- and middle-income groups who may have impaired credit records restricting access to mainstream products. It has over c 63,500 customers. The Aspen property bridging business has been developing since its launch in 2017.

Investment summary

S&U H121 results were substantially affected by the COVID-19 pandemic but the company has remained profitable and there are clear signs of improvement. While profitability over our forecast period looks set to be relatively subdued, the benefits of tighter credit criteria, increased new business and work to enhance aspects of Advantage’s activities should become more apparent in FY23 and FY24.

Y/E Jan
Revenue (£m)
PBT (£m)
EPS (p)
P/E (x)
P/CF (x)
2019A 83.0 39.5 34.6 232.0 7.2 19.1
2020A 89.9 40.4 35.1 239.4 7.0 40.7
2021E 82.0 23.1 18.6 124.3 13.4 7.6
2022E 80.5 29.3 24.8 165.7 10.0 46.6
Industry outlook

The unpredictable course of the pandemic means that S&U does not believe it is appropriate to provide specific guidance but current year results will be significantly affected by lower sales and higher arrears. Management indicates the group is still profitable, is maintaining its high customer service levels and has liquidity headroom to respond once it is sensible to target stronger growth. H120 results are due to be announced 30 September.

Last updated on 21/10/2020
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Share price graph
Balance sheet
Forecast net debt (£m) 105.9
Forecast gearing ratio (%) 58
Price performance
Actual (2.9) 2.5 (20.7)
Relative* (1.7) 7.0 (5.4)
52-week high/low 2500.0p/1430.0p
*% relative to local index
Key management
Chris Redford FD
Anthony Coombs Executive Chairman of the Board

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