Sanne Group (SNN) rewarded shareholders with a hefty dividend rise at the half-year mark, as the administration outsourcer revealed a 46 per cent increase in underlying profits to £10.2m. Numbers were impressive across the board, but the group's immediate prospects have been enhanced by a step-up in new business activity and an expanded commercial offering.
The group drew in around £6.7m in projected annualised fees from new and existing clients during the period. The business proposition is being helped by a tightening regulatory framework in European financial markets as business managers are increasingly outsourcing compliance work in relation to strictures such as the Common Reporting Standard and the European Alternative Investment Fund Managers Directive.
The business successfully diversified, both geographically and in terms of the service offering, through deals to acquire Dublin-based Chartered Corporate Services and IDS Fund Services, a South African business that provides a hedge fund platform - a key strategic objective of management.
Investec expects adjusted profits of £20.7m for the December year-end, leading to EPS of 15.8p, rising to £24.6m and 18.5p in 2017.
| SANNE GROUP (SNN) | ||||
|---|---|---|---|---|
| ORD PRICE: | 465p | MARKET VALUE: | £538m | |
| TOUCH: | 465-470p | 12-MONTH HIGH: | 477p | LOW: 280p |
| DIVIDEND YIELD: | 1.9% | PE RATIO: | 37 | |
| NET ASSET VALUE: | 20p* | NET DEBT: | 32% | |
| Half-year to 30 June | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2015 | 21.1 | -5.0 | -4.9 | 1.4 |
| 2016 | 27.6 | 8.1 | 6.3 | 3.2 |
| % change | +31 | - | - | +129 |
Ex-div: 15 Sep Payment: 14 Oct *Includes intangible assets of £23m, or 20p a share | ||||
