Ann: Appendix 4D and Half Yearly Report, page-41

I have two niggling issues here (although you're well protected with the current price):
(point 1 plays into your concern)

1) The services division cut employee costs, but a chunk of that is because much of the expense is borne up front. You sign the customer on, then receive cash over the next 3-5years (depending on the type of customer).
The total amount of debt managed has reduced, meaning future years' cash flows will be impacted - not necessarily the current year

2) The personal loan business (the jewel in the crown as far as I'm concerned), is not growing. From 31st December to now, they've grown it by $2m. Meanwhile, companies like MNY have managed to grow their loan book significantly.
FSA are not yet restricted by their credit facilities, and can well and truly afford increased 30/90day delinquency rates. I'm unsure why they don't grow it faster (although management have proven to be very good at capital allocation, so it's likely I'm missing something)


Even if current earnings remain, you're getting this at 7-8 times earnings. That's a great yield. It just lacks the upside I'm after.