Two years after implementing its strategic plan, Brewin Dolphin (BRW) is in a growth phase, says chief executive David Nicol. Its efforts consolidating its offices and focusing on higher-margin discretionary wealth management work have paid off. It gained record net discretionary fund inflows – including transfers – of £2.3bn during the year to September, taking the total under management to £33.8bn. That put the wealth manager on track to meet its target to increase discretionary funds by one-third via net new business alone by 2020.
Overall funds under management rose by 13 per cent to £40.1bn. That compared with a 6 per cent increase in the MSCI WMA Private Investor Balanced Index. Growth in the proportion of discretionary funds meant core fee income was up 16 per cent to £208m, while commission income continued to decline.
Management broadened its direct client product range, launching wealth planning and investment advice provider WealthPilot. The product is a lower cost, simplified version of its core service, aimed at a broader audience. On the other end of the spectrum, it is also looking to develop a product for clients with more sophisticated wealth planning needs. On the intermediary side – which accounted for 90 per cent of net new fund growth – a passive version of its Managed Portfolio Service platform was introduced.
Analysts at Cantor Fitzgerald expect adjusted pre-tax profits of £80m for the year to September 2018, giving EPS of 22.3p (from £70m and 19.6p in 2017).
| BREWIN DOLPHIN (BRW) | ||||
| ORD PRICE: | 376.7p | MARKET VALUE: | £1.07bn | |
| TOUCH: | 376.5-376.9p | 12-MONTH HIGH: | 368p | LOW: 261p |
| DIVIDEND YIELD: | 4% | PE RATIO: | 23 | |
| NET ASSET VALUE: | 93p* | NET CASH: | £170m | |
| Year to 30 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2013 | 284 | 28.4 | 8.4 | 8.6 |
| 2014 | 281 | 6.8 | 2.0 | 9.9 |
| 2015 | 284 | 61.0 | 17.7 | 12 |
| 2016 | 280 | 50.1 | 14.4 | 13 |
| 2017 | 304 | 57.6 | 16.5 | 15 |
| % change | +9 | +15 | +15 | +15 |
| Ex-div: | 11 Jan | |||
| Payment: | 7 Feb | |||
| *Includes intangible assets of £96m, or 34p a share | ||||
