Private client investors faced a tough time in 2012 amid a backdrop of economic and regulatory uncertainty, so Rathbone Brothers (RAT) did well to push funds under management ahead by 13.4 per cent to £17.98bn at a time when the FTSE 100 index and the FTSE APCIMS balanced index rose 5.9 per cent and 5.8 per cent respectively.
The growth in funds reflected a £1.03bn positive market performance together with £1.6bn of organic inflows and £0.48bn from new investment teams and two private client acquisitions - RM Walkden and AIB Jersey. Set against these were outflows of £1.16bn. Net investment management fee income rose from £80.1m to £89.6m, while net commission income was up from £36.2m to £37.4m.
And despite the tough climate, client numbers rose from 38,400 to 39,500, and the number of investment managers grew from 184 to 205. Inevitably this pushed underlying operating expenses up by 13.8 per cent to £110.5m, and trimmed operating margins from 33.6 per cent to 30.4 per cent, while the underlying cost to income ratio rose from 66.4 per cent to 69.6 per cent. Encouragingly, Rathbone Unit Trust Management continued its revival, boosting funds by 16.5 per cent to £1.27bn, although higher expenses trimmed profits from £800,000 to £600,000.
Numis is forecasting 2013 adjusted pre-tax profits of £52.2m and EPS of 83.4p (2012: £45.1m/77.3p).
| RATHBONE BROTHERS (RAT) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,401p | MARKET VALUE: | £644m | |
| TOUCH: | 1,401-1,407p | 12-MONTH HIGH: | 1,495p | LOW: 1,130p |
| DIVIDEND YIELD: | 3.4% | PE RATIO: | 21 | |
| NET ASSET VALUE: | 499p* | |||
| Year to 31 Dec | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|
| 2008 | 42.3 | 67.6 | 42.0 |
| 2009 | 29.5 | 46.9 | 42.0 |
| 2010 | 30.1 | 49.8 | 44.0 |
| 2011 | 39.2 | 66.7 | 46.0 |
| 2012 | 38.8 | 67.0 | 47.0 |
| % change | -1 | - | +2 |
Ex-div: 24 Apr Payment: 16 May *Includes intangible assets of £97m, or 212p a share | |||
