LONDON (Reuters) - Consumer lender Provident Financial Plc
Shares in the firm, which specialises in doorstep lending in which its agents deliver short-term loans and call each week to collect repayments, jumped 9.1 percent to 662 pence at 8:18 a.m. British time.
Provident said the plan might involve a full demerger or a listing and a partial sale of a stake. If agreed, it is likely to take place in about a year, Provident Chief Executive Robin Ashton said.
"We believe the overall business might be better valued if international had a separate listing," Ashton told Reuters in an interview.
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"The faster you go with international (expansion), the more start-up loss you take, and we’ve been thinking whether we would be better able to develop the business if we had separate shareholders for international," he added.
Provident, which warned twice last year that its profits would not reach analysts’ expectations, also reported 2005 profits for its ongoing operations of 206 million pounds ($358 million), down 1.1 percent on the year.
Including 165.6 million pounds in costs to close Provident’s Yes Car Credit business, which was announced last year, the group’s pretax profit slumped to 40.4 million pounds.
Profits last year in the international unit jumped 28 percent from a year earlier to 51.1 million pounds, representing about a quarter of the group total.
At Tuesday’s close, Provident was valued at 1.55 billion pounds, indicating the international business, which has operations in Central Europe and Mexico, could be valued at about 400 million pounds.
Provident said the home credit sector remained competitive and that there remained pressure on its customers’ disposable income. It said it expected the unit’s profits to fall this year in line with market expectations.
