I am delighted to announce such a strong, positive result, especially by comparison to other businesses that are being impacted by some tough economic conditions.
John Hughes, Managing Director, Radio Rentals Australia

Video/RTO Online

Radio Rentals.

Radio Rentals Australia, Australia's largest rent-to-own company, today reported fiscal year net profit of $12.3 million, a 13% increase over the prior year. Company officials said the performance reinforces Rentals' "Underlying strength and ability to perform well during difficult economic times."

The strong performance came despite the costs associated with the development of three new brand initiatives; the re-launch of Rentlo in South Australia, the roll-out of a payday-loan division - Cashfirst (see story), and the launch of BigBrownBox.com.au  (see story), an online retail presence.

Managing Director, John Hughes said, "I am delighted to announce such a strong, positive result, especially by comparison to other businesses that are being impacted by some tough economic conditions. The strength of our core business, coupled with the innovation that we are demonstrating through our strategic initiatives, places the Company in a very strong position in the market, regardless of economic conditions, which explains why we have been around for over 70 years."

RTO Archives: See interview with Peter Krideras, Radio Rentals

The company celebrated its 70th year in business in 2007 with the launch of a re-designed website (see story) with the tagline "Join the Rental Revolution".

Total revenues for the year grew 9% to $127.4 million. Revenue from PCs and flat panel TVs grew 18%. Furniture rentals gained 25% and fitness equipment grew 21%. Appliance rentals were down.

Radio Rental also reported that past-due accounts are at a record low, reinforcing the company's strategy of ensuring that customers are not overcommitted. Customer count rose 6.9%, building on a 4% increase during the last fiscal year.

Based on the success of the company's Rentlo brand initiative, Radio Rentals will open two additional Rentlo stores in the next six months. The company said in a statement, "The development of these sites will significantly strengthen the Company's long-term position in the South Australian market."

Radio's payday loan brand, Cashfirst, rolled out nationally in September 2008, finished the year with a lower than expected loan portfolio of $3 million. The company cited the economy causing a higher than expected decline-rate as the primary cause.

BigBrownBox.com.au, Radio Rentals' internet retail offering launched in December 2008, is now in the Top 20 of retail internet sites in Australia.