Egg Turns A Profit!

YorkshireBoy

There's been some talk on here recently about why Egg offers are so good - some say "loss-leaders" given to increase market share prior to a sale of the company.

With this in mind I was interested to read in my local paper's business section last night...

Credit Card Profits Up
Internet bank Egg today unveiled a move into the black in the first half. Egg said balances grew by 5% in the six months to June 30 compared with the industry equivalent of 2%. The uplift contributed to an overall group pre-tax profit of £15m in the period against a loss of £1.7m last time. The UK arm delivered operating profits of £23 against £35.8m last time as the impact of a cut in personal loan sales volumes offset higher credit card income.

Rafter

£23 million is good but pales into insignificance against the £500m Egg has lost since it first started.

The have done some creative accounting to reduce this cumulative loss and a lot of the losses relate to their disasterous French operation, but even so, Egg have proved that it is impossible to make a decent profit out of their current offers and customer base.

I certainly wouldn't be rushing to buy shares!

R

jon_msn

Egg may have made a profit, but....

Changes which come into effect on 1 August 2005.:
(both Egg Green and Blue)

* We are increasing the variable annual rate of interest on
your Egg Card from **14.9%** to **15.9%**

Changes which come into effect on 1 September 2005.
The following changes are only on your green Egg Card:

* We are increasing the variable annual rate of interest on
Cash Advances from **17.9%** to **20.9%**

* We are amending Condition 11, regarding cash back. Cash
back will no longer be payable on all Purchases for those
customers who applied for an Egg Card from 1 October 2001.
The definition of cash back in Condition 8.1 is being
changed to reflect this. For customers who applied before
October 2001, cash back will be paid provided the total
amount is ú10 or more. These changes will not alter the
amount of cash back that is paid out to you in September
2005. All customers will still be able to take advantage
of our special cash back offers with online retailers.


(from email just received)

cheets99

yup im gonna move all my money to a halifax card.