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Prestige rentals increase at Accident Exchange

The proportion of prestige credit hire rentals by Accident Exchange has increased in the first quarter of the financial year leading to improved margins, the company told shareholders at its AGM this morning.

Cash collections have been improved by the group's more pro-active litigation strategy, which pursues insurers for outstanding claims.

Cash collected from its litigation panel was £6.6m in the first quarter compared to £1.4m in the comparative period last year and £4.8m recorded in the preceding quarter.

Internal collections were up to £33.0m in the first quarter from £26.8m in the first quarter of last year.

Rental days in the first quarter increased to 307,000 from 251,000 for the same period last year."

Fleet utilisation improved to 65% from 61%, and the proportion of prestige vehicle revenue has recovered to 82% from 81%.

"Margins have benefited from these operational improvements and also from the effect of improved hire rates with effect from 1 June 2008 as a result of the agreed 3.5% increase in rental day rates under the ABI General Terms of Agreement," said Accident Exchange's statement.

"The board continues to expect further improvement in cash collection rates and is seeing the benefits of the litigation strategy which was initiated in January 2008."

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