24th Jan 2014 08:51
LONDON (Alliance News) - Wealth manager Brooks Macdonald Group PLC Friday said trading for the recent half year was in line with its expectations, with higher revenues and profits than during the same time last year.
The AIM-quoted wealth manager, which runs a number of companies, including a fund management business, a financial advisory and a stockbroker, said progress had been made as a result of both internal growth and acquisitions.
"The first half of our financial year has seen good progress made across the group, with strong organic growth in funds under management aided in part by positive investment conditions. We continue to review interesting acquisition opportunities as evidenced by the Levitas and North Row Capital transactions, both of which further enhance our investment offering," Chris Macdonald, chief executive, said in a statement.
In a trading update for the half-year ended December 31, 2013, Brooks Macdonald said the discretionary funds it manages rose by 5.8% to GBP5.68 billion in the three months to December 31, against a 3% rise in the APCIMS balanced index.
The growth in discretionary funds under management over the second-quarter, which encompass the funds in its asset management, funds, and international businesses, was put down to a combination of performance - calculated at about GBP160 million - and net new business of about GBP150 million.
Taking into account Brooks Macdonalds' performance in the first-quarter, discretionary funds rose by 11% or GBP570 million, the company said, comparing the rate to the 5% achieved by the APCIMS balanced index over the period.
Advisory funds managed rose to GBP374 million from GBP354 million over the second-quarter, while property assets under administration were flat at GBP1.07 billion. Third party assets under administration exceeded GBP160 million at the end of the second-quarter, compared to GBP140 million at the start.
Meanwhile, Brooks Macdonald gave further details on the IFSL North Row Liquid Property Fund it is set to launch in February.
North Row Capital LLP, a partnership with Steven Grahame and Gerald Parkes in which Brooks Macdonald will have a 60% stake, will invest in global real estate markets by investing mainly in property derivatives, as well as property equity and debt, to gain exposure to the direct property markets.
Brooks Macdonald will invest about GBP300,000 in establishing the partnership and the fund, and said about half of that has already been completed.
"Deferred consideration will be payable amounting to 13% of the third-year revenue generated by the partnership; this is expected to total approximately GBP300,000 and is capped at GBP2 million. The partnership is expected to break even in the financial year ending June 30, 2015, and to become profitable in the financial year ending June 30, 2016," Brooks Macdonald said in a statement.
Brooks Macdonald reiterated that it expects Levitas to be earnings enhancing in the next financial year.
In December, Brooks Macdonald acquired an option to purchase Levitas Investment Management Services Ltd. Levitas is the sponsor of two funds, known as TM Levitas A and TM Levitas B, for which Brooks Macdonald is the investment adviser.
Brooks Macdonald said it intends to issue its half-year results on Wednesday March 12.
Brooks Macdonald shares were Friday quoted at 1,466.25 pence, down 3.75p.
By Samuel Agini; [email protected]; @samuelagini
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