The significant decline in gold prices has sent ripples though the pawnbroking sector, with H&T (HAT) this week warning that profits for the current year would be down from 2012, having sustained a 38 per cent drop in pre-tax profits in the first half of the year.
The news also hit rival pawnbroker Albemarle & Bond (ABM), which issued its own warning on profits late last year after it became clear that customers were either running out of gold items to sell or were reluctant to cash in their jewellery in the face of falling prices. The industry has also been affected by the prospect of increased regulation to control the explosion in payday lenders charging extreme interest rates and using unscrupulous marketing methods. Neither H&T nor Albemarle & Bond has been involved in such practices, but the sector as a whole has come under scrutiny.
