Provident Financial plc is the leading non-standard lender in the UK. The group serves 2.4 million customers and its operations consist of Vanquis Bank, the Consumer Credit Division (CCD) comprising Provident, Satsuma and glo, and Moneybarn.

Strong financial performance and dividend increase
Adjusted profit before tax1 up 25.0% to £292.9m (2014: £234.4m) and adjusted earnings per share1 up 22.6% to 162.6p (2014: 132.6p).
Statutory profit before tax up 21.8% to £273.6m (2014: £224.6m) and basic earnings per share up 20.0% to 151.8p (2014: 126.5p).
Return on assets2 of 16.1%, an increase from 15.1% in 2014 mainly attributable to CCD.
Total dividend per share up 22.6% to 120.1p (2014: 98.0p).
Strong growth and returns in Vanquis Bank
UK profit before tax up by 22.8% to £185.5m (2014: £151.0m).
UK customer and average receivables growth of 9.9% and 19.6% respectively, reflecting strong momentum from addressing the underserved non-standard credit card market.
UK risk-adjusted margin3 of 32.8% (2014: 33.2%), ahead of minimum target of 30%, with arrears at record lows.
Chris Sweeney appointed as Managing Director following the retirement of Michael Lenora.
Successful repositioning of CCD
Adjusted profit before tax1 up 1.4% to £105.4m (2014: £103.9m).
Successful repositioning of the Provident home credit business as a smaller, better-quality, more cost-efficient business focused on returns.
Year-on-year reduction in receivables of 7.3% due to tighter credit standards and shorter duration of the book, with reduction narrowing from 18.0% at June 2015.
Marked improvement in the risk-adjusted margin3 to 82.2% (2014: 69.1%) due to significant improvement in credit quality.
Continued investment in Satsuma to support the development of the substantial online market opportunity.
Business plan to roll out the glo guarantor loans proposition during 2016 is now in place.
Sharp increase in new business at Moneybarn
Adjusted profit before tax1 of £21.3m in 2015, 42.0% higher than pro forma4 2014 profits of £15.0m.
Significant year-on-year growth in new business volumes of 69%, reflecting access to the group’s funding and product extensions.
Default rates in line with plan and stable risk-adjusted margin of 24.3% (2014: 24.6%).
Robust funding position and strong capital generation
Gearing reduced to 2.2 times (2014: 2.4 times) through strong capital generation.
Group fully funded to May 2018.
Capital generated of £189.9m (2014: £175.5m), more than covering dividends in respect of 2015 of £173.6m (2014: £141.3m)
Key financial results
     2015    2014    Change
Adjusted profit before tax1    £292.9m    £234.4m    25.0%
Statutory profit before tax    £273.6m    £224.6m    21.8%
Adjusted earnings per share1    162.6p    132.6p    22.6%
Basic earnings per share    151.8p    126.5p    20.0%
Return on assets2    16.1%    15.1%     
Final dividend per share    80.9p    63.9p    26.6%
Total dividend per share    120.1p    98.0p    22.6%

Peter Crook, Chief Executive, commented:
“I am delighted to announce adjusted earnings per share growth of 22.6% in 2015 and a 22.6% increase in the dividend for the year, reflecting strong capital generation and a very robust funding position.

Vanquis Bank produced another excellent set of results which saw UK profits up 22.8%. With credit standards unchanged, the business has continued to generate strong growth and margins through developing the underserved non-standard credit card market.

CCD’s profits increased by 1.4%, delivering on its plans to maintain profits whilst repositioning the Provident home credit business and funding the start-up of its Satsuma online instalment lending business which represents a substantial market opportunity and will be developed further in 2016.

Moneybarn has performed extremely well in its first full year of ownership, with access to the group’s funding lines supporting a 69% increase in new business volumes and 42% increase in profits.

The group has made a good start to 2016. Vanquis Bank and Moneybarn have continued to trade strongly and the home credit business has enjoyed a very satisfactory collections performance.”


Enquiries    Today    Thereafter
David Stevenson, Provident Financial    020 7404 5959    01274 351351
Nick Cosgrove, Simone Selzer, Brunswick    020 7404 5959    020 7404 5959
Investor Relations          
Gary Thompson, Provident Financial    020 7404 5959    01274 351351

Adjusted profit before tax is stated before: (i) £7.5m of amortisation in respect of acquisition intangibles established as part of the acquisition of Moneybarn in August 2014 (2014: £2.5m) – see note 6; and (ii) exceptional costs of £11.8m in respect of business restructuring in CCD (2014: £3.4m) – see note 2. Adjusted profit before tax in 2014 was also stated prior to £3.9m of costs incurred in respect of the acquisition of Moneybarn.
Adjusted profit before interest after tax as a percentage of average receivables.
Revenue less impairment as a percentage of average receivables.
Restated to apply the group’s lower cost of funding to pre-acquisition results.