14th Mar 2019 10:26
LONDON (Alliance News) - Stockbroker Jarvis Securities PLC said Thursday its 2018 profit dipped on higher costs and tougher markets, despite revenue growing strongly.
In 2018, pretax profit narrowed 2.3% to GBP4.3 million from GBP4.4 million the year prior. This was despite revenue rising 7.4% to GBP10.1 million from GBP9.4 million the year before.
Profit performance was hurt by administrative costs rising faster than revenue, up 14% to GBP5.7 million from GBP5.0 million the year before.
"I am delighted with these results despite the small drop in the profit before tax," Jarvis Chair Andrew Grant said. "Revenues have increased through restructuring our commercial fee tariffs and providing additional revenue generating services to our commercial clients.
"The anticipated cost increases brought about by MIFID II have been offset by the higher revenue and last year's record profitability has been almost equalled in a market that over the course of the year was comparatively more difficult," Grant added.
In 2018, Jarvis paid 24.5 pence in dividends which was 4.3% higher than the 23.5p paid out in 2017. In late January, Jarvis proposed its first quarterly payment for 2019 at 6.0p per share, 20% higher than the 5.0p paid the year prior.
"The tougher conditions experienced in the final quarter of the year remain at the time of writing, fuelled by economic uncertainty and low investor confidence," Grant continued. "I do not anticipate this continuing in the longer term as clarity over Brexit arrangements will soon be forthcoming, at which point I expect client trading volumes to return to previous higher levels. As a UK centric business, we remain largely unaffected by the other ramifications of Brexit."
"I am optimistic about the coming year," Grant said. "2019 will benefit from a full year of the additional services and fee tariffs that were introduced in June 2018. The second half of 2018 substantially outperformed the first six months and we would have had another record year had these been in place for the full 12 months."
"There are no significant cost increases anticipated, but most importantly there are no further major pieces of regulation to adopt," Grant added. "This will leave management and staff to focus on developing and growing the business."
Shares in Jarvis were 0.2% lower at 494.00 pence on Thursday.
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