Pawnbroker Albemarle & Bond was forced into an emergency £35 million fundraising today as sliding gold prices hammered profits.
Its shares sank 55.25p, or 44%, to 69.75p. Although it rose today, the price of gold has dropped by about a third in the past two years, hitting the firm. The company has 230 stores but will close 33 unprofitable pop-up ones.
The firm’s woes contrast with the height of the recession when pawnbrokers were the big winners, deluging consumers around the clock with cash-for-gold ads.
Albemarle also unveiled a new chief executive, Chris Gillespie, who will join next week from Provident Financial, where he managed its doorstep lending division.
His first job will be to negotiate with biggest shareholder, EZCorp to underwrite the £35 million needed, as the company warned profits are unlikely to be enough to avoid a covenant breach on its £51 million debts.
