BrightHouse falls to £16m loss in latest quarter

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Brighthouse falls to £16m loss in latest quarter
BrightHouse quarterly losses deepen by 36%.
// BrightHouse quarterly losses fall by 36% year-on-year
// Rent-to-buy retailer closed 36 UK stores in 2019
// Former Thomas Cook exec Anth Mooney now leading the business

Rent-to-own retailer BrightHouse fell to a loss of £16 million in its latest financial quarter as it was hit by rising compensation claims.

The business’ loss deepened by more than a third from £11,893 million to £16,283 million year-on-year to September 28.


READ MORE: Brighthouse appoints former Thomas Cook retail boss as CEO


During that time the company took out a £5.6 million provision to cover customer claims that their ability to payments had not been properly assessed by the company.

“The volume of complaints received have been higher than we forecasted and therefore our provision for affordability claims has increased by £5.6 million to £12.6 million,” BrightHouse said in its quarterly report to September 28.

In October 2017 BrightHouse was ordered by the Financial Conduct Authority to pay £14.8 million to compensate 250,000 customers to whom it lent irresponsibly.

As part of its annual results posts at Companies House on December 19, BrightHouse noted that it had closed 36 stores in the UK in 2019, as part of a “business-wide cost reduction programme, aligned to a new business strategy”.

The retailer said it now plans to expand its customer base by improving its like-for-like revenues “through further simplification of the sign-up process”, customer retention and the development of its ecommerce capabilities.

BrightHouse is owned by a handful of private equity groups, selling house household goods through repayment plans.

“We have continued to receive affordability claims from customers which we are required to investigate and, if it is found that the correct procedures have not been followed, reimburse them accordingly,” BrightHouse noted in its quarterly report to September 28.

“The volume of complaints received have been higher than we forecasted and therefore our provision for affordability claims has increased by £5.6m to £12.6m. The current provision recognised is based upon an estimation of future claims, payout rates using historic rates, processing costs and the rate of cases referred to the Financial Ombudsman Service [FOS].

“However, a number of risks and uncertainties remain in particular with respect to the number of claims that will be received, the rate of cases referred and key decisions by FOS. We are in the process of disputing recent cases where the FOS has given initial adjudicator views against us in terms of our historical product prices and our affordability assessments.”

“If these test cases were formally upheld by the FOS there would be a material increase in the cost for settling such cases, it is not possible to quantify the aggregated increased cost of such a situation,” BrightHouse added.

Back in April 2019 BrightHouse announced it had named Anth Mooney, former chief of retail and financial services at Thomas Cook, as its new chief executive.

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22 COMMENTS

  1. Brighthouse have been scamming stupid people for years! And they bring in a former Thomas Cook higher up as CEO? Didn’t they run the company into the ground? They are all a load of snake oil salesmen.

  2. Thank goodness you can afford to pay for items out right David and Clive
    Perhaps you should live in a low wage and work all hours just to provide for you family
    Brighthouse has been brilliant for my family

  3. It is right? They have scammed people for years, people on low incomes.
    Further more they introduce insurance and bright are cover as extra to your contract payment but if a claim is sought they refuse to take the blame
    Definitely scammed me and many others this way, nice to see the back of them.

  4. I’ve been using brighthouse for years, I work 70 hours a week and I’m definitely not stupid. David and Clive should keep their small minded opinions to themselves.

  5. The issue the FCA should be addressing is the delivery charges they make at Brighthouse. If you buy a TV and have it over three years , there is a delivery charge of 60 pounds and that is added to your account with interest added over the 156 weeks of the agreement which adds a hefty amount to the cost.

  6. Brighthoude as always be up front with you have pay and explain everything to the customer so how can anybody say there have been scammer people for years if you don’t like terms don’t sign the papers it’s as simple as that

  7. I am not stupid in fact I had a very good job however I was diagnosed with a chronic illness I am now on a life of benefits, don’t go slanging of brighthouse turn you’re bigoted mind to the high street retailers who refuse to help those on low income due to benefits.

  8. Have a TV smart one have had nothing but trouble with TV cannot even the use smart bits just fed up with them they keep fobbing me off well have got the office of fair trading involved.

  9. I am on a low wage and I do miss payments I got a tv from them telling me that it is the same price as argos but argos is 499 and I got the tv 2 years ago and i still owe 1200 on it RIP off and if u do miss payments you have someone banging on your door with in a couple of days they are not call buy now regret later for nothing RIP off

  10. BrightHouse do not have a “future strategy”. They pinned all of their hopes on “pay day lending” but now cannot generate the cash to support it. The whole business model was wasteful – directors in £150k Porsches and Aston Martins. As an organisation they cannot manage their own finances, and therefore by default they should not be able to assess other peoples.

    BrightHouse fulfil a need in the market (consumer goods to people who do not have access to regular credit) but in doing so they look to exploit those people with extreme interest rates. They have a lot of good store staff but the whole management of the organisation rotten to the core.

    I genuinely feel sorry for the people who need them not only as they cannot access reasonable rates of credit but also that BrightHouse exploit this. The high street (and Internet) will be a better place without them.

  11. I worked for brighthouse and the idiots who are posting stupid comments have probably been knocked back by brighthouse. We didn’t drag people in off the street

  12. People like David making uneducated comments are either previous BH customers who have been kicked out of the customer base or stupid themselves making comments without seeing the good the staff do for the customers. It’s often the customers who demand and demand more items not the company pushing more debt. Do your homework David!

  13. Im with bright house and have been i have had no problems i pay my bill and i am satisfied with everything never had a problem snd im a mum of one on low income and still mange to pay the bill also the staff are so good i can walk in and they know me and want to talk very good sad if this is what will come of brighthouse

  14. I love brighthouse yes they overcharge with interest but people on very low incomes have no choice Without them theres no spare cash for breakdowns on welfare I wouldn’t have a fab washer a dryer a fridge freezer laptop and my fab tv..Their staff are brilliant and always very helpful
    Christine

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