29th Feb 2016 10:28
LONDON (Alliance News) - River & Mercantile Group PLC on Monday said it had a "reasonable" opening half to its financial year, against a backdrop of volatile markets, and revealed plans to increase its remuneration ratio in the medium term.
The company declared an interim dividend of 3.6 pence per share, of which 0.35p is a special dividend and relating to net performance fees, measuring up against a total interim dividend of 4.6p the prior year, which included a 1.0p special payment.
Pretax profit fell to GBP3.3 million in the six months ended December 31, from GBP5.3 million the corresponding half the prior year, primarily due to lower advisory and performance fees, net of remuneration, partly offset by higher net management fees.
Total revenue was down to GBP23.4 million from GBP26.4 million as a result, while operating expenses edged up to GBP7.0 million from GBP6.9 million. Remuneration and benefits fell to GBP13.1 million from GBP14.2 million.
"As we had guided, the strongest growth has been experienced in derivatives and equities, and I would expect this to continue in the near term. Nonetheless, I would expect the performance of the advisory and fiduciary business lines to improve from here. I am happy to report growth in assets year on year and that we have generated performance fees in difficult conditions," Chief Executive Officer Mike Faulkner said.
"The current conditions in the industry create an opportunity to attract talent, particularly in the area of client engagement and accordingly we have increased our remuneration ratio in the medium term to facilitate this investment in the business," Faulkner said.
The remuneration ratio applicable to net management and advisory fees was 54% in the first half, and will be maintained at around that level, taken from net management and advisory fees in the medium term, the company said.
Shares in River and Mercantile Group were untraded on Monday morning, having last traded at 221.00p.
By Samuel Agini; [email protected]; @samuelagini
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