27th Feb 2020 11:43
(Alliance News) - finnCap Group PLC said Thursday it expects to trade profitably in financial 2020, despite a mixed performance from its operating segments.
For the year to the end of March, the broker said its equity capital markets division has continued to complete several deals, winning a further 19 retained corporate clients, despite client churn from delistings or acquisitions.
As a result, finnCap's expects the segment's performance for the second half to be in-line with that recorded in the first half of the year.
For the M&A division, the company said that its results would be dependent on a number of higher value transactions. However, since the timetable for these deals have lengthened, the division is expected to report a slower second half trading performance compared to the first.
However, the M&A division has continued to sign up deal retainers in the year, securing 36 more mandates and generating deal retainers of GBP1.2 million, leading to expectations of an improved first quarter in financial 2021, finnCap added.
Overall, finnCap expects its trading performance for the second half of financial 2020 to be broadly breakeven and trade profitably for the year as a whole.
"The combination of the reduction in costs, the expectation that the M&A division will benefit from closing the larger deals delayed from the second half of the current financial year, and a continuing return to more normal market conditions in the equity capital market division, means that the board expects the group's trading performance in the first quarter of the 2021 financial year will show an improvement on its performance in the second half of the current financial year," the company said.
Looking ahead, finncap noted the ongoing spread of the coronavirus and its effect on capital markets, and will "closely monitor the situation".
Shares in finnCap were untraded on Thursday, last quoted at 23.50 pence in London.
By Dayo Laniyan; [email protected]
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