The Credit Corp Group Limited (ASX: CCP) share price was one of the worst performers on the S&P/ASX 200 Index (ASX: XJO) on Thursday.
The debt collector's shares finished the day a disappointing 18% lower at $10.11.
This was a big improvement on its performance in morning trade, though. At one stage its shares were down as much as 41% to a multi-year low of $7.23.
This material drop in its share price has prompted the release of an update by Credit Corp this morning.
What did Credit Corp announce?
Credit Corp has followed the lead of many other ASX companies by announcing that it is withdrawing its FY 2020 earnings and investment guidance. This is due to the uncertain impacts arising from the spread of coronavirus (COVID-19).
Management advised that these impacts include the potential for increased restrictions on the availability of Credit Corp's workforce, as well as the prospect of a deterioration in economic conditions which may reduce the capacity of customers to make repayments.
One positive, though, is that the company has continued to perform strongly over recent weeks and no material impacts arising from COVID-19 have been observed in its operating results.
What now?
The company stressed that it has a proven and industry-leading approach to customer hardship, which it believes delivers strong business results and sustainable consumer outcomes.
Management intends to continue applying this approach in circumstances of increased demand for these capabilities by the company's major credit issuer clients.
Credit Corp also pointed out that its balance sheet and funding positions are strong. It currently has $170 million of cash and undrawn credit lines available under facility agreements that mature in 2022 and 2023. In addition to this, it notes that its gearing remains conservative.
Overall, management appears positive on the future and believes the company is well positioned to secure favourable investment opportunities as and when they arise.
