A relatively flat market for mortgage advances in the first half of 2017 didn’t stop Mortgage Advice Bureau (MAB1) from pushing gross profits ahead by a fifth in the six months to June, after edging up its market share from 4.0 per cent to 4.4 per cent.
Average adviser numbers during the period grew by 14 per cent to 974, with 1,046 at period-end, and gross mortgage lending was up 9 per cent at £5.2bn. The focus going forward is to continue growing market share by offering a broader and more integrated range of services, helped by greater use of technology. This will include complementing the more traditional face-to-face advice with a growing proportion of telephone advice.
Revenue from mortgage procurement fees rose by 8 per cent to £20.5m, while protection and general insurance commission grew by nearly a quarter to £19.8m. However, comparisons were distorted by the previous year’s rush to secure buy-to-let mortgages before the introduction of higher stamp duty, with these types of mortgages attracting a lower level of insurance protection. Adjusted cash conversion remained high at 116 per cent.
Analysts at Canaccord Genuity expect adjusted pre-tax profits of £14.2m for the year to December, giving EPS of 22.7p (up from 2016: £12.5m/20p).
| MORTGAGE ADVICE BUREAU (MAB1) | ||||
| ORD PRICE: | 490p | MARKET VALUE: | £249m | |
| TOUCH: | 490-510p | 12-MONTH HIGH: | 510p | LOW: 281p |
| DIVIDEND YIELD: | 4.1% | PE RATIO: | 18 | |
| NET ASSET VALUE: | 31p* | NET CASH: | £10.9m | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2016 | 43.1 | 5.3 | 8.6 | 7.8 |
| 2017 | 49.6 | 6.3 | 10.6 | 9.5 |
| % change | +15 | +19 | +23 | +22 |
| Ex-div: | 05 Oct | |||
| Payment: | 27 Oct | |||
| *Includes intangible assets of £4.2m or 8p a share | ||||
