The stock was up 17% on Friday, albeit off a 7-year share price low.
Companies: Vanquis Banking Group PLC
Provident Financial (LON: PFG) has released a trading update today, trying to boost the market's confidence in the Group after its infamous downfall in August.
66% of its share price was wiped off in a single day's trading on August 22 after Management issued a profit warning caused by its underperforming home credit division. It also announced its subsidiary bank Vanquis was under investigation by the FCA and it had suspended all sales.
It said it expected pre-exceptional losses to be in the range of £80m to £120m, as Management confirmed today the recovery process was "consistent with this guidance".
August's profit warning was the second in two months, which led to the resignation of Group CEO Peter Crook.
It also said today that Vanquis was still under investigation by the FCA over its Repayment Option Plan, and that the service is still unavailable to new customers.
The Bradford-based doorstep lender's update today confirmed a full-year dividend would not be issued.
Commenting on the restructure since the August crash, Management said:
"The changes made over recent weeks have prevented any further deterioration in performance and should provide the foundation for delivering the necessary improvement in customer service. Collections performance in September was 65%, up from 57% in August, whilst sales were approximately £6m per week lower than the prior year compared with £9m during August."
Shares were up 17% at the time of writing to 910p. To compare, the stock was trading at 3250p in May - see the 12-month price chart below.
PFG's current PE ratio is 7x, half that industry median of 14x, and has a market cap of £1.2bn.
