Wealth management group Brewin Dolphin (BRW) delivered a much stronger performance than the headline figures suggest for the latest year. In fact, adding back various one-off items left adjusted pre-tax profits 22 per cent higher at £52.3m.
Funds under management grew from £25.9bn to £28.2bn, and a £2.7bn positive investment performance more than offset a £400m net outflow of funds. Crucially, most of the outflows came from funds managed on an advisory basis, while higher-margin discretionary funds saw a £1.1bn net inflow of funds, taking the discretionary funds total up from £18.2bn to £21.3bn, or 76 per cent of total managed and advised funds, and compared with a target of 80 per cent by 2016. Accordingly, fee income rose by 25 per cent to £152m, while commission income was 11 per cent higher at £93.5m.
There has also been a rethink on dividends, which from next year will equate to 60-80 per cent of adjusted, diluted EPS. Using forecasts from RBC Capital Markets, this means that next year's payout could rise to between 10.1p and 13.5p a share. RBC is also forecasting adjusted pre-tax profits of £61.7m and EPS of 16.9p (from £52.3m and 14.9p in 2013).
BREWIN DOLPHIN (BRW) | ||||
---|---|---|---|---|
ORD PRICE: | 282p | MARKET VALUE: | £769m | |
TOUCH: | 281-282p | 12-MONTH HIGH: | 289p | LOW: 182p |
DIVIDEND YIELD: | 3% | PE RATIO: | 33 | |
NET ASSET VALUE: | 81p* | NET CASH: | £134m** |
Year to 29 Sep | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
---|---|---|---|
2009 | 21.9 | 7.40 | 7.10 |
2010 | 31.4 | 9.70 | 7.10 |
2011 | 21.9 | 6.60 | 7.10 |
2012 | 29.9 | 9.10 | 7.15 |
2013 | 28.6 | 8.50 | 8.60 |
% change | -4 | -7 | +20 |
Ex-div: 26 Feb Payment: 28 Mar *Includes intangible assets of £127m, or 47p a share **Includes £20.3m of client settlement cash |