Weak IPO market hits profits, but Equities revenue rose 31%, and firm made £1.4m from investments
Companies: Numis Corporation Plc
AIM-listed stockbroker Numis has reported a 38% fall in pre-tax profit in its half-year results this morning, citing a drop in IPOs and a 26% decline in corporate broking and advisory revenues in the six months to 31 March.
Revenues were down 8% at £52.4m, compared to the record high revenues recorded last year of £56.8m. Equities revenue rose 31% to £23.4m, which offset a 26% fall in broking and advisory revenue to £29m. Numis conducted just two IPOs in the period, compared to ten last year.
As a result, profit-before-tax was down 38% to £10.5m and EPS dropped to 8p/share, compared to an H116 PBT of £16.8m and EPS of 12.2p. The figure would have been even lower were it not for an included £1.4m net gain on its strategic investment portfolio.
It also confirmed that Numis Founder and Ex-CEO Oliver Hemsley is leaving the board with immediate effect.
Co-CEOs Alex Ham and Ross Mitchinson said the business remained focused on servicing its corporate client base while expanding its franchise into supporting unquoted companies, too:
"Numis delivered a creditable performance when viewed against record revenue generation in the comparable prior period and muted primary issuance market-wide...
We believe our ability to nurture relationships with entrepreneurs and business leaders ranging from first fund-raisers through to stock market IPO candidates and into FTSE 100 market leaders gives us a unique insight into the UK's most exciting businesses. When coupled with the strong relationships we enjoy with our institutional clients, this provides an excellent platform from which to further develop and build the business."
Numis said trading in H2 had started well, and the firm had completed ten corporate transactions generating £10m in fees already. The company stated that, when coupled with its deal pipeline, this activity gave it confidence that the business will have a satisfactory outcome for the full year.
Shares in Numis fell 4% shortly after opening on Monday.
