Gold slowdown takes the shine off Albemarle

A SLOWDOWN in the high street “gold rush” has left pawnbroker Albemarle & Bond facing its first drop in annual profits in two decades.

The firm’s income from gold buying grew by 18 per cent in the six months to 30 June, compared with an “exceptional” 88 per cent rise in the previous half year when households looked to raise cash by selling jewellery.

The company, which has 184 stores and 50 gold buying pop-up outlets, said there was a “sudden slowdown” in demand since a peak in March and that gold buying levels were likely to continue to fall back, affecting group profits in the current financial year to June.

Shares fell 12 per cent, even though results yesterday for the last financial year showed profits rose for the 21st year in a row, up 2 per cent to £21.4 million.

The group has seen gold prices pull back after three years of more than 20 per cent compound growth a year, although the cost of gold ended the year “broadly stable”, according to Albemarle.

Chief executive Barry Stevenson said: “The expected downturn in the gold buying market happened very quickly and has set a new level to which we have quickly adapted.

“We expect gold buying to continue to be a significant profit contributor to the group, albeit at much reduced levels to that achieved at the peak.”