The Thorn Group Ltd (ASX: TGA) share price has risen by more than 6% to 18.5 cents in morning trading, after the company reported an improved first half loss of $1 million, compared to a net loss of $24.6 million at the same time last year.
What else moved the Thorn Group share price
The company says it was able to improve its bottom line in the first half despite revenue falling by 44.9% from $104.9 million to $57.8 million.
Thorn says that it achieved more than $40 million of annualised cost savings during the half, and commenced a rapid transformation of the Radio Rentals business to a digital model.
It also says that it meticulously managed the impact of COVID-19 on the Thorn Business Finance segment by repaying its $10 million corporate debt facility and focusing on maximising cashflow.
However, Thorn’s provisions for the impact of COVID-19 pandemic and the Radio Rentals’ store closure program have increased from $39.4 million to $50.9 million. These provisions comprise $13.6 million for the Radio Rentals business, and $37.3 million for the Business Finance Division.
The company announced that a special fully franked dividend of 7.5 cents per share was paid to shareholders after the end of the half, on 3 November 2020.
Thorn continues its previously announced position of not providing profit guidance.
What management said
Thorn Group chief executive Pete Lirantzis explained the transformations in the business, saying:
Over the last six months the new management team and board have executed major initiatives to set Thorn Group up for success, while navigating through the COVID pandemic.
Thorn is now on a path to growth with Radio Rentals transforming from bricks and mortar to digital. Radio Rentals will be expanding its product range to offer greater choice to customers, digitising and automating processes to improve customer experience and reduce costs, and enhancing customers’ end-to-end experience.
Meanwhile in Thorn Business Finance, we have a deeper understanding of the needs of our customers and are developing new value propositions, leveraging disruptive technologies, to target specific SME segments.
What does Thorn Group do
Thorn is a financial services company providing financial solutions to consumers and businesses. Thorn’s consumer leasing business, Radio Rentals, is a leader in the household goods leasing market, operating since 1937.
Thorn Business Finance is a provider of leasing and other financial services to small and medium enterprises. The company has been listed on the ASX since 2006
In July, the company announced the full closure of its Radio Rentals stores. The company had initially closed its stores temporarily due to the coronavirus pandemic, later deciding to close them permanently.
The Radio Rentals business will instead utilise a purely online model that will onboard customers digitally.
About the Thorn Group share price
The Thorn Group share price has lost almost 20% of its value in 2020 due to difficult market conditions. The company had earlier reported an $81 million loss for its full year FY20.
The Thorn Group share price listed in 2006 at a price of 72 cents. At its current price of 18.5 cents, it has a market value of $59 million.
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