Thriving Albemarle & Bond to open more stores

Pawnbroker Albemarle & Bond is on target to open

Albemarle, which issues loans against gold jewellery and diamonds, said today that performance remains strong despite increased competition and a softening demand for gold jewellery.

The group's core pledge book is growing at around 10% a year, as customers struggling to cope with the recession make greater use of its services.

Pawnbrokers have lately enjoyed record profits on the back of soaring gold prices, which have made it more attractive to scrap second-hand items rather than sell them.

Albemarle reported a 75% jump in first-half profit, while rival H&T Group posted a 70% rise in full-year profit in March.

The group said its nine "pop-up shops" have traded well and announced it is looking to open a further six gold-buying stands by the end of the financial year.

Shares in Albemarle moved up 0.5p to 240.5p today, leaving the company valued at around £130 million.

Broker Collins Stewart says the shares are a buy, setting a price target of 310p.

"Given current economic turmoil, the solidity of the gold price further reinforces the group's business model," says analyst Michael O'Brien.