Printer Friendly

CIT: ELECTRONICS, HOME LIFTED YEARLY GROWTH.

Byline: Michael Rudnick

NEW YORK-In the factoring universe, the big just keep getting bigger. For proof, look at market-share leader CIT.

During its year-end earnings call earlier this month, CIT Group Inc. boasted that its factoring business, which falls under the CIT Commercial Finance division, had a record year with annual factoring volume approaching $40 billion. In November 2004, HFN reported CIT's annual volume at $20 billion, achieving the factoring industry's top spot.

CIT's 2004 factoring assets were roughly $6.2 billion, compared with about $6.3 billion in 2003, said Jeffrey Peek, CIT Group's chairman and chief executive officer.

A notable side note: This is the first time in recent history that CIT has announced factoring volume to investors, John Daly, president of CIT Commercial Finance, told HFN.

The factoring firm pointed to its push into new industry sectors, including consumer electronics, home furnishings and refactoring, as a driver of 2004 growth. Traditionally, CIT has focused on textiles and apparel sectors, Peek said.

"There has been a little shift in our traditional mix due to our expansion in furnishings, consumer electronics and refactoring. A large part of new business signing has been in these areas," Daly said. He added that the company has experienced more than 50 percent growth in each of these sectors.

"A lot more consumer electronics are being imported, lending itself to these companies looking for factoring," Daly added. "We have worked hard to build relationships across oceans, continents and borders to source business in consumer electronics."

Daly attributed the growth in home furnishings factoring to a "resurgence" in new home buying, and consumers redecorating.

The third growth sector for CIT, refactoring, involves outsourcing factoring to smaller commercial finance companies that provide lending to small entrepreneurs. "CIT has the tremendous infrastructure to provide wholesale back-office and factoring services to these small finance companies."

The factoring giant's growth extends beyond new sector outreach. Daly partly attributed the company's profitability improvements to the added volume gained from the acquisitions of GE and HSBC's factoring divisions in the late part of 2003.

CIT is hoping that its 2004 momentum will continue into this year. "[In] commercial services, the new business backlog remains very strong here, due to its market leadership and market share, and the penetration of new markets has been very favorable," said Peek of the factoring division's 2005 expectations.

CIT hopes to spur continued new sector expansion via a sales initiative to promote cross-selling and collaboration across CIT Group's various business units. The company is actively seeking a chief sales officer to manage this initiative. Daly noted that it is too early to provide specifics.

CIT Group's net income for the year ended Dec. 31 was $753.6 million, up from $566.9 million in 2003. It expects to increase earnings per share in 2005 by more than 10 percent.

Caption(s): John Daly, CIT: "We have worked hard to source business in consumer electronics."
COPYRIGHT 2005 MacFadden Communications Group LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2005 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:HFN The Weekly Newspaper for the Home Furnishing Network
Geographic Code:1USA
Date:Jan 31, 2005
Words:488
Previous Article:A.G. EDWARDS DOWNGRADES MAY AFTER ACQUISITION RUMORS.
Next Article:NEWS BRIEFS.
Topics:


Related Articles
CIT sees little growth in electrics: exports will provide the greatest opportunity for U.S. manufacturers.
Center for Information Technology presents road show.
CONSOLIDATION EFFORTS SHAPE AN INDUSTRY; THE TOP COMPANIES ARE GETTING BIGGER BY ACQUIRING BANK BUSINESSES.
NEWS BRIEFS.
PULLING AWAY; CIT DISTANCES ITSELF FROM THE PACK AS IT DOUBLES ITS ANNUAL VOLUME.
SHIFT ABROAD KEEPS FUELING IMPORT-FACTORING DEMAND.

Terms of use | Privacy policy | Copyright © 2022 Farlex, Inc. | Feedback | For webmasters |