The hovering worth of gold prompting extra individuals to “filter” their jewelry bins has bolstered earnings for retailer and lender Ramsdens.
The Middlesbrough-based chain, which has 169 UK shops, reported a surge in revenue from its treasured metals shopping for service and its jewelry store.
Pre-tax earnings surged by 54% to a report £6.1 million for the six months to the top of March, in contrast with the identical interval final 12 months.
Whole revenues rose by 18% to £51.6 million year-on-year, the corporate instructed traders.
Revenues from shopping for treasured metals had been up by practically a 3rd as “exceptionally excessive” gold costs helped enhance the load of gold being offered.
Ramsdens buys undesirable jewelry from clients after which both sells it in shops or on-line, or to a bullion seller.
Gold hit its highest ever worth in April, reaching about 3,500 US {dollars} (£2,600) per ounce, with traders flocking to the historically “secure haven” asset as Donald Trump’s tariff bulletins sparked turmoil within the wider monetary markets.
Ramsdens CEO Peter Kenyon mentioned: “The gold worth permits us to pay the shopper extra, means we make extra as nicely, and in addition helps pawnbroking a bit with a number of the recoveries when individuals don’t pay us again.”
He mentioned it’s not the case that there are “queues on the door” for gold-selling, however the larger worth is extra more likely to encourage clients to promote extra of their jewelry as soon as they realise how a lot money they will get for it.
“Most clients who promote their gold are new to that service as a result of often you solely filter your jewelry field as soon as,” he mentioned, including it leads to “two transactions from a brand new buyer” as soon as they’ve made an preliminary sale.
Ramsdens lately launched a chosen gold-buying web site which it mentioned is attracting extra clients than it had anticipated.
Revenues for its jewelry store surged 18% year-on-year, regardless of the upper price of treasured metals being handed on to clients by way of worth rises.
Kenyon mentioned the group is “capable of climate a downturn” ought to the value of gold drop sharply within the months forward.
In the meantime, rival pawnbrokers chain H&T final month agreed to be purchased by US big FirstCash for practically £300 million.
H&T is the UK’s largest pawnbroker with greater than 270 retailers throughout England, Scotland and Wales.
Kenyon mentioned he was “not shocked” by the takeover, as funding by US firms into the UK was more and more engaging amid the strengthening greenback.
“We’re a publicly-listed enterprise and if somebody got here with an enormous chequebook we’d must hear – however we’re not searching for a purchase order in the mean time,” he mentioned.
Shares in Ramsdens jumped by about 6% on Wednesday morning.
