A solid investment performance and net inflows of £1.2bn helped lift assets under management to a record £31.7bn at Jupiter Fund Management (JUP). Strong cash flow also left the group with just £11m of debt at the end of the year, which was subsequently paid off in February.
The strong increase in earnings per share also prompted a big increase in the dividend payout, and while some of the cash generated will be used for selective reinvestment, chief executive Edward Bonham Carter confirmed that the board will look to return excess cash to shareholders where appropriate. In fact, analysts at Numis believe that without any major investment opportunity, the ordinary payout ratio of 50 per cent (of dividend to earnings per share) could rise to as much as 80-90 per cent.
Greater involvement by individuals saving for their retirement remains one of the key drivers for future growth, and mutual funds, in which Jupiter is one of the market leaders, provide a convenient investment vehicle. Jupiter's business model also has limited reliance on performance fee income (up from £4.5m to £5.7m last year) with nearly all income deriving from management fees, which rose 18 per cent to £267.1m.
Numis expects adjusted pre-tax profits for the current year of £159m and EPS of 27.3p (from £148.5m and 24.9p previously).
| JUPITER FUND MANAGEMENT (JUP) | ||||
|---|---|---|---|---|
| ORD PRICE: | 417p | MARKET VALUE: | £ 1.91bn | |
| TOUCH: | 417-418p | 12-MONTH HIGH: | 421p | LOW: 272p |
| DIVIDEND YIELD: | 3.0% | PE RATIO: | 20 | |
| NET ASSET VALUE: | 112p* | NET CASH: | £160m | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 215 | 7 | 10.6 | nil |
| 2010 | 271 | 42 | 10.8 | 4.7 |
| 2011 | 347 | 70 | 15.6 | 7.8 |
| 2012 | 346 | 74 | 14.9 | 8.8 |
| 2013 | 389 | 114 | 21.1 | 12.6 |
| % change | +12 | +54 | +42 | +43 |
Ex-div: 9 Apr Payment: 27 May *Includes intangible assets of £369m, or 81p a share | ||||
