Economic woes fail to hold back International Personal Finance

The Leeds-based group said collections performance and credit quality remained sound in July, August and September.

It described sales growth as good although there was a modest slowdown as customers and agents became more cautious.

“Although consumer confidence has reduced, customers are paying well,” said chief executive John Harnett.

“There is caution on taking on new loans, which is sensible. The performance of the business was good in the third quarter and we’ve seen a big improvement in Mexico. In more benign economic conditions we would be gung-ho about our prospects for next year.”

IPF has been hit by a number of external factors outside its control. It warned earlier this year that growth could be hit by the eurozone debt crisis, as problems in more established economies threaten to spill over into neighbouring countries.

“A lot depends on whether we see resolution to the Greek debt problem and the euro crisis before Christmas,” said Mr Harnett.

He added that any effect on the company would start with the German economy.

“If Germany went into sharp recession it would knock on to Central European economies, but most people think it is more likely that Germany will see a slowdown rather than a recession,” he said.

The group, which lends small sums to households in countries such as Poland, Hungary, Romania and Slovakia, said it would continue to target growth in customer numbers and the credit issued.

It has recently tightened its credit criteria in order to deal with a deterioration in collections performance if external conditions get any worse.

The company said pre-tax profits for the three months to September 30 rose by 11 per cent to £27m, with revenues rising nine per cent.

The group’s shares rose 3.75 per cent last night, a rise of 9.8p to 270.8p.

Analyst James Hamilton at Numis said: “IPF is very rare in that it is delivering record profits, it is seeing forecast upgrades, it is delivering strong growth, it offers substantial recovery potential and it is being valued on a single figure multiple of earnings.

“Despite the worst recession in modern history the group delivered record profits in every half year period bar one.”

Despite the poor economic conditions Romania and Hungary delivered the strongest growth with statutory profits up 450 per cent and 23 per cent respectively.

Poland delivered 10 per cent growth in profitability with the Czech-Slovakia region delivering two per cent growth.