BrightHouse, the home furnishing retailer and the UK‘s largest rent-to-own company, will expand with 20 new stores this year.
In a trading update this morning, BrightHouse said that pre-tax profits jumped by 16% to £19.6m in the year to the end of March, on revenue up 5.5% to £351.7m
“The business has grown consistently over the nine years. We serve a group of 7m low-income households who have limited or no access to mainstream lenders. The products that we sell are essential. People need a sofa. They need a bed. There is huge demand for our services,” Chief Exec Lee McKee told City A.M.
“If you look at the US, where it has been established much longer, there are 9,500 rent-to-own stores. On a like-for-like basis that means there could be 2,000 in the UK,” he added.
“Our two mantras are to look after the customers and look after the colleagues,” McKee says, adding that it looked to companies with “sustained excellence” such as John Lewis as a model for good customer service.
Last year, growth prompted the retail chain‘s private equity owners Vision Capital to hire bankers at Rothschild to explore options for the business including an IPO that is understood to have been valued at up to £750m.
McKee said those talks have “died down” and probably won‘t resurface any time soon: “Of course they will continue to talk to people – that is what [private equity companies] do. But as far as the board of Brighthouse is concerned we are cracking on. The little flurry from 2014 seems to have died down and it is definitely not at the front of our minds.”