REG - S & U PLC - Trading Statement

S&UAnnouncement

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RNS Number : 0875L  S & U PLC  11 December 2025

11 December 2025

S&U plc

("S&U" or "the Group")

TRADING STATEMENT

S&U PLC (LSE: SUS), the specialist motor and property finance lender today
issues its trading update for the period 5(th) August 2025 to 10(th) December
2025.

 

Business Highlights

 

The turnaround in S&U's fortunes, predicted in our last trading statement
of early August, and confirmed at our interim results in October, continues
apace. Group profit at the end of the third quarter continues to beat budget.
Trading, particularly at Advantage, our motor finance business, is healthy
both in terms of new business volumes and quality. As a result, group net
receivables, the life blood of future profitability, now stand at c.£491 m
(2024: £447 m) and are accelerating month by month.

 

This surge clearly confirms the abilities of our businesses, once freed from
the shackles of regulatory intervention. The lifting of the FCA's s166 process
at Advantage in April, and the calming effect that the Supreme Court's
sensible decisions on commission disclosure in early August have had on the
wider industry, presage a firmer motor finance market. Indeed, the latest
Finance and Leasing Association statistics show the used car finance market up
by 6% in September, having declined slightly by 2% in the preceding months.

 

By comparison, the performance of both Advantage and Aspen has been remarkably
resilient given the chaotic and monumentally mishandled recent budget, and its
dampening effect on consumer confidence in general and more specifically on
the housing market. Ironically, a happy consequence now appears to be a
dawning realisation within the Treasury and the FCA that without growth and
greater access to credit, consumer satisfaction and protection are pretty
hypothetical.

 

Advantage Finance

The last four months have seen an upsurge in trading at Advantage, led by CEO
Karl Werner. Recent monthly agreement volumes have averaged 2,500, or over
£25m in value compared to 7,121 deals in the first half. Advantage's third
quarter, to the 31(st) of October, saw a record 869,000 finance applications,
and now receivables are a net c.£318m, an increase of 14% on the previous
quarter.

 

This has given Advantage the opportunity to both improve its interest margins,
especially amongst higher tier customers and, with a renewed scorecard and
updated affordability measures, also improve the quality of its loan book. As
a result, latest collection rates for November are at a record 93.4% of due.
Recency statistics on collections are at their best level for two years. The
very compliant way in which Advantage manages and guides its customers who
fall into arrears is shown by the most recent figures on the number and size
of successful repayment arrangements. In this way Advantage can assist its
customers to protect and improve their credit ratings - an attribute too
little recognised in the non-prime market.

 

We would encourage the Financial Conduct Authority to remember this when
addressing industry concerns about its Commission Redress scheme which is
currently under consultation. Advantage is only tangentially affected by this
commission debate, having never employed discretionary commission

 

("DCAs"); or tied arrangements; Advantage estimates that only 2.4% of its
customers even potentially qualify for redress consideration under the
proposed rules. Nevertheless, in conjunction with the Finance and Leasing
Association, Advantage has produced a comprehensive and constructive response
to the FCA, which proposes reductions in scope of redress and a much more
focused and efficient process.

 

Whatever the outcome, the company anticipates that the effect of commission
redress upon Advantage's current robust trading performance will be minimal.
Its strong rebound should continue unabated.

 

Aspen Bridging

 

Despite the drag on transactions in the residential property market caused by
the government prevarication mentioned earlier, Aspen continues to sensibly
grow its loan book. At half year net receivables stood at £148m. At the end
of the period under review these are now c.£173m.

 

Repayments in the period were at £47m and year to date they are ahead of
budget at £160m. Advances in the period were £75m, driven by a greater
number of smaller deals for bridging products augmented by our very popular
Buy to Let loans the average size of which is over £1.3m. Margins are stable
and on budget. Application numbers were inevitably affected by drawn out
budget speculation and then imposition of higher taxes on rental incomes,
council tax extensions and a new mansion tax; however, these have rebounded in
the last three weeks.

 

The quality of Aspen's loan book also remains good with just 16 out of 240
loans beyond term. Aspen is making steady progress on resolving the very small
number of longer-term cases.

 

Although it is to be hoped that lower interest rates will produce a
significant but unlikely revival in the UK's hidebound residential market,
Aspen will nevertheless produce a solid second half and another good profit
for the year as a whole.

 

Funding

 

The very welcome acceleration in activity throughout the Group of the past few
months has seen Group net borrowings rise to £241m from £180m at the half
year. Whilst the existing funding capacity of £280m will meet our
requirements for the immediate future, an exciting project is at present under
way to confirm substantially larger, but flexible, medium-term facilities on a
competitive basis. These will facilitate the expansion we foresee for both
businesses over the next three years.

 

Commenting on S&U's trading outlook, Anthony Coombs, S&U Chairman,
said:

"Recent months have undoubtedly confirmed that S&U has regained its "Va Va
Voom"; to quote my predecessor's habitual phrase. It is also true that
investors are increasingly aware of the value inherent in family-controlled
SME businesses with rewarding dividend policies. With both Advantage and Aspen
on the right track, we have every confidence in the good rewards for
shareholders we anticipate in the years to come".

 

 

 

 

 

For further information, please contact:

 Enquiries                                     S&U plc        c/o SEC Newgate

 Anthony Coombs
 Financial Public Relations                    SEC Newgate    020 7653 9848

 Bob Huxford, Harry Handyside, Aqsa Ali
 Broker                                        Peel Hunt LLP  020 7418 8900

 Andrew Buchanan, Rob Parker
 Broker                                        Berenberg      020 3207 7800

 James Felix, John Welch, Daniel Gee-Summons

 

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