By Claire Reilly

SYDNEY, NSW: Thorn Group, the company that operates rental giants Radio Rentals and Rentlo, has today announced a profit increase of 40%.

The results for the year ended 31 March 2011 show an increase in normalised net profit of 40%, up to $23 million, while the actual net profit was up 13% to $22 million. The company offered a final dividend of 4.95 cents, up 32%.

Click here to sign up for our FREE daily newsletter

A spokesperson for Thorn Group welcomed the figures, saying they had been driven by a 7.5% customer growth in the Radio Rentals and Rentlo businesses, an increase that is “very pleasing given the generally soft retail conditions”. The positive results were also attributed to the company’s own Responsible Rental and Lending Policy, which resulted in low levels of arrears.

“Rent, Try, $1 Buy, coupled with responsible credit management continue to be the catalysts of increases in average contract lengths, enhancing performance via a reduction in the rate of disconnection,” the spokesperson said.

“The consumer rental business continued to generate steady revenue growth across all product areas however furniture and whitegoods were the standout performers.”

Managing Director of Thorn Group, John Hughes, said he was pleased with the annual report and reiterated that positive customer feedback had indicated strengths in the areas of customer service and product offering. “Strong levels of repeat business also underline the very positive customer attitudes to our offering,” Hughes said.