UK pawnbroker sees profits surge after boom in price of gold
The owner of the UK's biggest pawnbroker said the recent gold price boom helped send half-year profits surging.
H&T group, which trades as H&T Pawnbrokers and was established in 1897, posted a 42.3% jump in pre-tax profits to £3.7m for the first six months of the year as it saw the price of gold leap by nearly 8%.
It comes as uncertainty over Brexit, fears over the world economy and consistently falling interest rates causing a poor return on savings have fuelled the demand for precious metals among businesses and individuals in Northern Ireland and the rest of the UK.
Demand for gold has been sent rocketing worldwide as investors look for safe haven assets amid uncertainty created by the Brexit vote.
The collapse in the value of the pound after the UK's decision to quit the EU has pushed gold prices even higher, with figures recently revealing the price of the yellow metal has soared 45% so far this year in sterling terms.
H&T said if the gold rush continues over the rest of the year, its second-half profits will also be given a boost.
The leap in first-half profit came as the company also delivered an 85% rise in its personal loan book, while it saw robust trading in its foreign exchange service and "we buy anything" buyback offering.
H&T said the rising price was helping the group weather tough market conditions, with pawnbrokers hit in recent years by intense competition and as gold jewellery has fallen out of favour.
Chief executive John Nichols said: "This is a promising start to the year in the face of challenging trading conditions, with a strong operational performance aided by favourable market conditions around the gold price."
One Belfast jeweller told the Belfast Telegraph it saw a doubling of trade in gold coins in the past six months and says customers are joining waiting lists to get their hands on sovereigns.
H&T said the average sterling gold price was £852 per troy ounce in the first half, up from £791 a year earlier, while it had soared since then to £1,017 in July.
The group's profits from pawnbroking scrap rose to £600,000 from £100,000 a year ago thanks to the gold price hike, which also benefited its gold buying earnings, at £1.5m against £1m a year earlier.