Non-Standard Finance H1 profits tumble as Covid-19 makes 'major impact' on trading

Consumer finance company Non-Standard Finance cautioned on Friday that the Covid-19 pandemic had made "a major impact" on the group in the second quarter.

Non-Standard Finance stated low levels of lending and collections had impacted by forbearance measures put in place by the company to service customers affected by the pandemic.

While the FTSE 250-listed group said normalised revenues were up 4% in the six months ended 30 June to £92.2m, normalised operating profits tumbled from £19.8m in the same period a year earlier to £5.0m.

As a result of the severely reduced profits, NSF said it would not be declaring an interim dividend but stated that it was still capable of operating within its financial covenants.

Chief executive John van Kuffeler said: "Whilst the first two months of the year delivered a solid trading performance, the impact of Covid-19, the associated restrictions on social distancing and the slowdown of the entire UK economy each had a profound and immediate impact on all areas of the business, operations and financial performance."

"Since the outbreak of the pandemic, both branch-based lending and home credit have traded ahead of management's previous expectations while the performance at guarantor loans has been below plan as lending has been limited pending the conclusion of the review by the FCA and is likely to remain subdued for the rest of the year. As a result, the group’s financial performance since the end of June 2020 is broadly in line with management's expectations."

As of 0945 GMT, NSF shares had slumped 12.10% to 4.03p.