The niche lender's Advantage Finance division delivered a record 24,500 transactions for the year ended January 31, 2018, up 24% on the previous year.
Customer numbers at Advantage reached 54,000, compared to 43,000 a year ago on the back of strong demand for its products.
The company has seen no signs yet of a slowdown reported recently by trade body, the Society of Motor Manufacturers & Traders.
Consumers may be tightening the purse strings in the face of rising inflation and stagnant wage growth but S & U remains confident in its prospects for further growth.
"Whilst the political and economic uncertainties inherent in both the Brexit negotiations and a slowing economy remain, S&U continues to demonstrate its historic ability to produce excellent results and strong, sustainable growth,” said chairman Anthony Coombs.
“We are confident that will continue."
In fact, the company believes the recent fall in new car sales is likely to prop up used car values, while the “economic advantages of diesel vehicles remain widely appreciated in Advantage's non-prime sector of the market”.
Reflecting its confident outlook, S & U has paid two interim dividends at a total of 60p for the year, compared to 52p a year ago.
Dealflo platform to support growth
It also expects Dealflo, which provides agreement automation services to the financial sector, to support further growth in business, improve margins and reverse the recent uptick in impairment-to-revenue.
The Deflo platform has processed more than $10bn of financial transactions per year and has improved transaction-to-approval rates, S & U said.
S&U’s bridging finance operation
Away from the motor lending business, S&U’s Aspen bridging finance pilot operation has also been gaining traction since its launch in early 2017.
Aspen has now issued more than £10mln loans as housing demand remains strong despite weaker consumer confidence and Brexit uncertainty.
S &U said the business has been supported by a buoyant residential refurbishment market for starter family housing.
Costs in Aspen have been controlled and lending margins and loan-to-value maintained to budget.
Aspen has already seen a number of repayments come through and S&U said it is “confident in the long-term viability and prospects for this business”.
S & U is well-funded to invest in its Advantage and Aspen businesses, having secured £53mln during the year, bringing its total borrowings to £105mln.
While this rate of investment is expected to slow next year, the company anticipates further funding to be concluded “shortly” to take its total committed loan facilities to £135mln.
Analysts welcome strong trading
"Despite market concerns about lending practices in the car finance market and falling new car sales volumes, we note that S&U continues to deliver strong performance while continuing to tighten underwriting standards and improve the quality of its lending," said Shore Capital anlayst Gary Greenwood.
"In addition, we see the bridging finance operation as providing a potential source of future earnings diversification.
"We also take comfort from the large, controlling, management shareholding in the group, which we believe strong aligns management interests with those of other investors."
ShoreCap estimates pre-tax profits for the 2018 fiscal year of £30.4mln, earnings per share of 202p and a dividend of 101p.