Shore Capital’s capital markets division drives increase in revenue
Shore Capital enjoyed a successful year with revenues up 22 per cent in 2019, driven by a strong year for its capital markets business.
Total revenue grew to exceed £50m while adjusted pre-tax profits grew more than 60 per cent to £6.6m.
Statutory pre-tax profits fell from £4.1m in 2018 to £0.3m in 2019, in part because of a number of one-off costs in the year. These were largely in relation to the acquisition of Stockdale Securities, together with the relocation of Shore Capital’s London office.
Adjusting for these one-off costs, the group delivered earnings per share of 27.7p. After one-off costs, earnings per share were 4.9p.
Shore Capital’s asset management division enjoyed a successful year, growing revenue, profit and assets under management (AUM). Overall AUM grew by 11 per cent to surpass £1bn during the year. Total revenue in the division rose 11 per cent to £17.7m, delivering £3.9m in pre-tax profit.
Shore Capital’s UK fund management business, Puma Investments, grew revenue by more than 15 per cent and profits by more than 20 per cent. Puma Property Finance closed over £200m in new loans, subsequently passing £600m of loans originated since inception.
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Shore Capital’s capital markets business reported a 27 per cent increase in total revenue to £32.4m, after the acquisition of Stockdale.
The investment group said its balance sheet and liquidity remain strong. It has liquid resources of approximately £30m at year-end in addition to a £20m undrawn working capital facility.
As such Shore Capital said it is “extremely well prepared for a sustained period of disrupted activity”.
However in the immediate term, the coronavirus outbreak is likely to impact the asset management division as investors apply more caution in allocating capital.
Chairman Howard Shore said: “We remain very much able to continue support for our clients and strongly believe that when business ‘normalises’ we will benefit from being a strong and stable participant in a distressed environment. We also remain open and willing to contemplate M&A opportunities as they may arise.”