Collection House shows some empathy

Volatile sentiment recorded in consumer surveys this year has fed through into the business of debt buyer Collection House, which has found that its customers are less inclined to commit to repayment plans.

Collection House chief executive Matthew Thomas told investors at the company's financial year results briefing that, despite this trend, the company had been able to increase cash collections from its purchased debt ledger portfolio by 20 per cent.

This was the main driver of a 20 per cent increase in the company's net profit for the year to June.

Thomas said: "Consumer sentiment is volatile. We have had to be empathetic with the customers and more flexible with repayments."

Collection House reported a 17 per cent increase in revenue to A$126 million and net profit of $22.5 million.

About three-quarters of the company's earnings come from its debt buying business. It bought $72.3 million of distressed debt during the year to June - down from $82.2 million the previous year.

The number of accounts rose from 263,000 in 2013/13 to 304,000 in the year to June. The number of those accounts that have entered into repayment arrangements rose from 51,000 to 55,000.

In the company's other division, collection services, the segment result was up 15.2 per cent to $9.4 million.