Ongoing economic uncertainty and market volatility continued to take a toll on Nucleus Financial (NUC) in the first half of 2019. The online platform for financial advisers saw assets under management increase by 7 per cent to £15.3bn, but that was primarily thanks to market gains of £1.2bn. Net inflows of £246m were down two-thirds on the same time in the prior year, as circumspection among advisers' clients abounded and consolidation within the industry exacerbated outflows.
The group has responded to the latter by partnering with an independent financial adviser consolidator, expected to provide greater resiliency in retaining business and attracting new funds. Nucleus also hopes a 5.5 per cent rise in customer numbers will translate to higher inflows when the macroeconomic environment improves.
However, investment in improving the core platform weighed on adjusted cash profits, which fell by 6 per cent to £4.6m. With £1.1m already spent and a planned £3m in annual expenditure on further development, the group has indicated that "other direct platform costs" will increase significantly in the second half.
Bloomberg consensus places cash profits at £7.4m and adjusted EPS at 7p for the full year, rising to £8.1m and 8p in 2020.
| NUCLEUS FINANCIAL (NUC) | ||||
| ORD PRICE: | 158p | MARKET VALUE: | £121m | |
| TOUCH: | 155-160p | 12-MONTH HIGH: | 231p | LOW: 128p |
| DIVIDEND YIELD: | 2.5% | PE RATIO: | 20 | |
| NET ASSET VALUE: | 24p | NET CASH: | £17m | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2018* | 24.2 | 3.05 | 2.8 | 1.4 |
| 2019 | 25.2 | 4.18 | 4.4 | 1.5 |
| % change | +4 | +37 | +57 | +7 |
| Ex-div: | 19 Sep | |||
| Payment: | 18 Oct | |||
| *Restated | ||||
