Albemarle enjoying the gold rush

Reading-based Albemarle & Bond, which has 174 stores and around 40 gold-buying pop-up shops, said its area of the market, which also includes payday loans, had been helped by the volatile and tough economic climate.

Albemarle, which has offered gold-buying services alongside traditional pawnbroking since 2009, said the gold-buying division saw an 88 per cent surge in gross profits to £12m as volumes bought increased by 57 per cent in the six months to December 31.

The wider group saw pre-tax profits increase 12 per cent to £12.1m, as the gold-buying division was also helped by the strong price of gold, which broke the 1,900 US dollars an ounce barrier last September and is currently at 1,740 US dollars.

Chief executive Barry Stevenson said: “We have been helped by the recent market environment which has seen traditional high street banks reduce the levels of consumer credit they offer as well as the general economic environment.”

Albemarle, which also trades as Herbert Brown, is two years into a five-year growth plan, which includes increasing the number of stores. The group opened 14 stores in the first half of the financial year and is on track to open 25 across the full year.

Its pawnbroking business recorded a 14 per cent rise in gross profit to £17.2m, as the pledge book for the division increased by 7 per cent to £38.3m.

However, the higher price of gold did not benefit all divisions as its retail arm was hit by weaker sales of jewellery, leading to a drop in profits to £2.7m, from £4.1m.