7th Mar 2019 11:05
LONDON (Alliance News) - Shares in investment manager Argo Group Ltd climbed Thursday as it announced a tender offer, though it has swung to an annual loss.
Argo will buy back up to GBP2.5 million of shares from shareholders, at a price between 18 pence and 26p per share. The higher figure would be a 71% premium to its Wednesday closing price.
The stock was trading 18% higher Thursday morning at 18p.
At the minimum price, Argo will buy back 30% of its shares, and at the maximum price 20%.
Argo will not be paying a dividend for 2018 but wants to resume them once it can report consistent profitability.
Turning to the annual results, Argo posted a pretax loss of USD1.2 million in 2018, after a profit of USD4.7 million the year prior.
Argo's assets under management fell to USD130.1 million from USD146.8 million, with that level not enough to ensure sustainable profit on a recurring management fee basis, in the absence of performance fees.
Looking ahead, Argo's focus will be on increasing its assets under management.
Revenue for 2018 was USD4.6 million, less than half the USD10.3 million reported in 2017.
Argo said 2018 saw "a sharp fall" in values of most asset classes, driven by fears over global growth, political uncertainty, US dollar strength, and the US' trade disputes, particularly with China.
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