Sanne's (SNN) share price has risen by more than a third since the group listed in April. The company operates across nine countries, providing back-office support to fund managers and ultra-high-net-worth private clients. Three of its six divisions cater to asset managers in the alternatives space - namely debt, real estate and private equity. These businesses typically generate around two-thirds of the group's revenue and during the first half helped drive an increase in adjusted cash profits of more than a quarter to £8.3m.
IPO-related costs of £8.8m masked healthy growth across the group's divisions, augmented by new business with annualised fees of around £7.8m. The group's largest debt business increased revenues by a fifth to £6.5m, boosted by increased loan agency business with institutional clients. In real estate, revenue increased by almost three-quarters to £4.4m. New mandates are being driven by a growing trend among fund managers to outsource non-core roles such as back-office accounting.
The group's executive incentives business provides specialist trusteeship of employee share trusts and associated administration services. Revenues here grew marginally to £2.3m. Regulatory developments such as the Foreign Account Tax Compliance Act (FATCA) have boosted the group's corporate and institutional business. The business is developing regulatory reporting services not simply to meet FATCA and related regulatory requirements, but to cross-sell across other divisions.
Broker Investec Securities expects adjusted EPS of 12.5p for FY2015.
SANNE GROUP (SNN) | ||||
|---|---|---|---|---|
| ORD PRICE: | 275p | MARKET VALUE: | £319m | |
| TOUCH: | 271-282p | 12-MONTH HIGH: | 288p | LOW: 200p |
| DIVIDEND YIELD: | 0.5% | PE RATIO: | NA | |
| NET ASSET VALUE: | 11p* | NET DEBT: | 68% | |
| Half-year to 30 June | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2014 | 16.7 | 4.0 | 3.5 | nil |
| 2015 | 21.1 | -5.0 | -4.6 | 1.4 |
| % change | +26 | - | - | - |
Ex-div: 3 Sep Payment: 30 Sep *Includes intangible assets of £8.5m, or 7p a share | ||||
