Morses Club plc (LON:MCL), an established provider of non-standard financial services, has provided the following update on trading and the publication of its FY20 results following the trading statement issued on 16 July.
The Company has continued to make progress in July despite the challenges of Covid-19. Collections in the HCC division for July increased to 98% of normal historic expectations when measured against expected terms, an increase from 91% at the end of June, and are anticipated to reach pre-Covid levels by the end of August 2020, as previously reported. Cash in July has improved slightly to 82.3% of the level achieved in 2019. Sales were 80.9% of the levels for the same period in 2019 again an improving trend whilst customer satisfaction has been maintained at 97% or above during the period.
Response to the launch of remote lending to new customers has been positive with demand building strongly. Payment to terms for the initial cohort of new customers is 100%, reflecting high quality lending. Payment to terms for new lending to existing customers currently stands at 97%.
The Company is encouraged by continued growth in customer interest in the online customer portal, which now has over 110,000 customers registered compared with c. 78,000 at the end of FY20, demonstrating the accelerated roll-out of our digital strategy despite the Covid-19 environment.
The Group has continued to implement structural changes to the business with employees and agents continuing to work from home until the end of the year. Further restructuring of the Group’s property portfolio is progressing as a result and we are encouraged that agent vacancy rates are now at the lowest level in the Company’s history.
During July, progress in Shelby Finance, the Group’s digital division, has continued with growing levels of lending and an encouraging uplift in demand for longer-term lending products evident. Collections have strengthened at above 80% to terms, which is an improvement on the level prior to Covid-19, with the level of demand for the e-banking current account product remaining stable.
The audit process for the Company’s FY20 results continues as the results will include the impact of Covid-19 on the impairment of the closing loan book as at 29 February 2020. Morses Club will update the market on the announcement date for its full year results in due course.
Arrangements for the AGM, which will be held virtually due to government guidance on social distancing, will be announced separately.
Paul Smith, CEO of Morses Club commented,
“We are encouraged by both the improvements in lending and the quality of the lending performance that we have delivered during July. We continue to make progress despite the impact of Covid-19, reflecting the success of our prudent approach to managing the business whilst strengthening and diversifying our product offering and putting our customers at the heart of the business.”