Volatility can be a double-edged sword for stockbrokers such as Numis (NUM). On the one hand, unpredictable equity markets post-referendum and the US election spurred investors to increase the volume and value they traded, boosting its trading revenue. However, these political shocks meant companies were also more insecure about listing on the London markets during the six months to the end of March. This hurt pre-tax profit (see table).
Revenue from corporate broking and advisory business was down a quarter on the same time in the previous year to £29m. The broker completed just two IPOs and raised £0.7bn in equity finance for clients, compared with 10 IPOs and £1.2bn during 2016. This was reflective of the broader market trend, where capital raisings were down 1 per cent. The number of companies for which it acted as a broker was also flat on the end of September at 199. The group completed 17 advisory roles, primarily on M&A transactions.
Combined institutional commission and trading revenue was up almost a third to £23m, matching the highest level recorded by the group during a six-month period. It also had number one market share for 129 stocks, up from 127 during FY2016.
NUMIS CORPORATION (NUM) | ||||
|---|---|---|---|---|
| ORD PRICE: | 275p | MARKET VALUE: | £311m | |
| TOUCH: | 265-275p | 12-MONTH HIGH: | 291p | LOW: 175p |
| DIVIDEND YIELD: | 4.4% | PE RATIO: | 14 | |
| NET ASSET VALUE: | 115p | NET CASH: | £71m | |
| Half-year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2016 | 56.8 | 16.8 | 12.2 | 5.5 |
| 2017 | 52.4 | 10.5 | 8 | 5.5 |
| % change | -8 | -38 | -34 | - |
Ex-div: 18 May Payment: 23 Jun | ||||
