Park Group profits soar

The group, which focuses on the Christmas savings and corporate vouchers markets, said that orders for this year’s festive season were “close to the level of a year ago”.

Park has taken orders from 416,000 customers for Christmas so far, a 4 per cent drop on the same time last year, but at a 3 per cent average higher value.

Sales in the Christmas savings business rose 15 per cent to £165.5m in the year to March 31.

Park group managing director Chris Houghton said that the group as a whole had notched up record recruitment from agencies and customers in the year. The group is attracting a more affluent customer, said Houghton, as it widens its offer to appeal to a broader customer base.

Pre-tax profits at the group rose 24 per cent from £5m to £6.2m in the year. Sales rose 11 per cent to £250.5m.

However, the group is being affected by low interest rate levels on cash balances held from customers. Houghton said that the group was experiencing inflation in certain areas and expected interest rates to return to higher levels “in some time”.

Sales of Park’s corporate vouchers, which form incentive and reward schemes used by retailers including Marks & Spencer and John Lewis, grew by 4 per cent to £85m.

The group, which was founded as a Christmas hampers business, said high-margin hampers contribute to the group but that the majority of sales in its Christmas savings business come through vouchers.

Online sales, where the group is focusing expansion, rocketed 161 per cent to £6m.

Park was affected by the collapse of rival Farepak in 2006, which left 150,000 savers £40m out of pocket.

Houghton said that “confidence is carefully being rebuilt” and that Park, which since 2007 has placed pre-payments in a separate trust account, has no bank debts.