Sanne (SNN) is spreading its wings. Financial services regulation is increasing the world over, prompting the administration outsourcer to acquire new businesses in territories including the US, South Africa and the Netherlands. In January the group bought Mauritius-based International Financial Services, giving it a base to serve companies trading in India and Africa.
New business worth an annual £13.8m was won during the year, up from £13m in 2015. Providing back-office support to institutional managers of alternative assets plays the biggest part in generating revenue for Sanne. The debt division expanded its operations in London, Luxembourg, Dublin and the Netherlands, helping push sales up 19 per cent to £16.4m. Meanwhile, weaker sterling made real estate increasingly popular around the time of the EU referendum. That helped Sanne win more work in this area, with real-estate-related revenue increasing more than a third to almost £14m.
However, uncertainty caused by the referendum also meant executive incentives-related revenue fell marginally to £4.7m. That's because of fewer share transactions by existing clients. The acquired North American alternatives business generated £3.1m in sales and £1.7m in gross profits in 2016, but only two months-worth contributed to Sanne.
Analysts at Investec expect adjusted pre-tax profits of £40.1m in 2017, giving EPS of 24p (up from £22m and 17.4p in 2016).
SANNE (SNN) | ||||
|---|---|---|---|---|
| ORD PRICE: | 661p | MARKET VALUE: | £932m | |
| TOUCH: | 661-662.5p | 12-MONTH HIGH: | 709p | LOW: 360p |
| DIVIDEND YIELD: | 1.5% | PE RATIO: | 58 | |
| NET ASSET VALUE: | 93p* | NET CASH: | £46.1m | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012** | 18.7 | 4.4 | na | na |
| 2013 | 26.0 | 6.1 | na | na |
| 2014 | 35.6 | 7.8 | 6.1 | 4.9 |
| 2015 | 45.6 | 2.4 | 1.4 | 7.0 |
| 2016 | 63.8 | 15.0 | 11.4 | 9.6 |
| % change | +40 | +523 | +714 | +37 |
Ex-div: 6 Apr Payment: 23 May *Includes intangible assets of £83m, or 59p a share **Pre-IPO figures | ||||
