The UK business of Cash Converters continues to struggle and...

The UK business of Cash Converters continues to struggle and make profits, as has been highlighted in announcements by company

Although it will not affect the bottom line this financial half - If pound continues to remain week - we could see large losses in the UK operation of Cash Converters

Below are some extracts taken from financial year 2015 annual report and half year earnings 2016


Cash Convertors Annual Report 2015

The normalised UK divisional EBITDA was a loss of $9.0 million against a loss of $1.1 million for the previous corresponding period

The UK corporate store network ended 2015 with an EBITDA loss of £1.5 million (2014: £0.4 million loss)
The UK personal loan book ended the year at £9.3 million (2014: £15.7 million) following the legislation change in the UK in January 2015

Corporate store network in the UK now 59 stores

Australia 71,349,416 56,461,798 +26.4 UK (9,032,554) (1,051,668) -756.4 International 428,517 508,585 -15.7

Australia 71,349,416 56,461,798 +26.4 UK (9,032,554) (1,051,668) -756.4 International 428,517 508,585 -15.7


First Half Financial Year 2016 – reported 29/2/16

The UK business incurred an impairment charge of £3.8 million ($7.6 million) in the financial year ending 30 June 2015.

For the six months ending 31 December 2015 conditions have remained difficult in the UK especially in regard to our corporate store network which has performed behind plan and incurred further losses, which has resulted in a further impairment charge of £1.1 million ($2.2 million) being recognised during the current period.

The UK personal loan book as at 31 December 2015 was £8.7 million.

The UK personal loan book produced an EBITDA of £284K compared to a loss of £1.6 million as at 31 December 2014.

The UK cash advance business produced an EBITDA profit of £283K (2014:£370K) down 24% on the previous period. Cash Advance

• Total principal loaned for the six month period ended 31 December 2015 increased 3.6% to £15.2 million (six month period ended 30 June 2015: £14.7 million)

• Average loan amount as at 31 December 2015 £181 (30 June 2015: £147)

• Total customer numbers increased by 5.1% to 188,639 (30 June 2015: 179,534) Personal Loans • Total number of loans approved for the six month period ended 31 December 2015 increased by 41.1% to 11,514 (six month period ended 30 June 2014: 8,163)

• Total principal loaned for the six month period ended 31 December 2015 increased by 54.6% to £6.7 million (six month period ended 30 June 2015: £4.4 million)

• Total number of active customers increased by 2.1% to 14,334 (30 June 2015: 14,040) • Loan book decreased by 6.5% to £8.7 million (30 June 2015: $9.3 million)

The UK corporate store network has struggled in tough trading conditions. The EBITDA for the period was a loss of £1.1 million compared to the previous corresponding period profit of £243K.

CCUK, with effect from 1 July 2015, has contracted the services of the Cox Group to manage the corporate store network.

The Cox Group is a multi-store franchise business and has the relevant experience to improve the financial performance of the UK stores – the initial agreement is for three years.

This arrangement brings together the expertise of a proven multi-store franchise operator with the capital and infrastructure support of the Company.

As at 31 December 2015 there are 59 (2014: 58) corporate stores trading in the UK.