Philately is back in fashion, according to stamp collecting and autographs group Stanley Gibbons, with sales of British specimens enjoying a boom as a flurry of new collectors buy them as investments.
Despite the generally gloomy economic times, Stanley Gibbons's sales of British stamps to collectors are up 74% so far this year. They were boosted by the London 2010 Stamp Exhibition in May, at which the company unveiled Britain's rarest stamp – the 6d IR official, otherwise known as the Edward VII 6d Pale Dull Purple (IR Official).
Issued on 14 March 1904, the stamp was printed on just 19 sheets and was withdrawn almost immediately after issue. Most were destroyed, but a few survive in museums and royal collections. Stanley Gibbons sold its copy after the show for £400,000.
Last year sales to collectors of British stamps were flat, hit to some extent by the weakness in the economy during that time. The company also warned on profits after deferring proceeds from some sales. This year, however, Stanley Gibbons said it has witnessed a "resurgence in demand". This has helped push the GB30 Rarities Index, put together by the company in 2004 to track the price of classic British stamps, up 7% this year.
The current low interest rate environment, coupled with volatility in stock and bond markets across the world, has pushed savers looking for a good rate of return into alternative investments such as wine. Stamps are also benefiting with Stanley Gibbons reporting a 34% increase in sales to collectors through its philatelic dealing departments.
"We continue to see an increasing number of new high net worth collectors at the same time as an increasing number of investors looking to place an element of their wealth in a tangible asset with a value embedded in history," said chairman Martin Bralsford.
Renewed interest in stamps for investment helped the company, which recently refurbished its flagship retail premises on the Strand in London, report half-year sales up 24% to £11.9m and profits of £1.6m, up from £1.4m. Auction commissions rose 28%, not least because of the success of its public auction in June, which made a record £900,000 with more than 90% of the lots sold. The auction also saw intense interest in Chinese stamps, a new area which the company hopes will pay big dividends in future. The Chinese stamps on offer fetched between three and 10 times the company's expectations.
"The market for stamps in China looks like it could be a major opportunity for us as we gain a better understanding of the characteristics of that market," said Bralsford. "I believe the Chinese stamp market will ultimately have a substantial impact on our future sales and profitability over the longer term."
Stanley Gibbons recently secured a top quality collection of investment grade stamps from China and already has over £1m of registered orders from investment clients which it hopes to fulfil later this year. Further trips to the far east are planned for September