11th Sep 2018 08:48
LONDON (Alliance News) - Sanne Group PLC on Tuesday said its profit for the first half of 2018 came in lower year-on-year due to the integration expenses associated with IFS Group.
The administration services provider said pretax profit declined 13% to GBP10.9 million in the six months to June 30 compared to GBP12.5 million reported for the same period a year ago, despite revenue jumping by 17% to GBP65.9 million from GBP56.3 million.
The company said it saw a good organic growth across all of its divisions, supported by acquisition of alternative investment fund LIS in February, which contributed for five months of the period.
Sanne said this acquisition provided a number of good cross-selling opportunities and exposure to a new range of institutional real estate fund managers.
As a result, revenue in the Europe, the Middle East & Africa Alternatives division rose by 41% to GBP32.7 million from GBP23.1 million.
The Asia-Pacific & Mauritius Alternatives segment saw a decline in revenue to GBP13.7 million from GBP14.0 million the year before, reflecting the fluctuation in the pound to dollar exchange rates. On a constant currency basis the business has grown revenue by 5.2%, helped by doubled number of clients in Hong Kong, Shanghai and Singapore.
Mauritius has started to grow on a constant currency basis, following the integration of Mauritius-based provider of corporate administration services IFS Group.
Thus, the group's operating expenses, which include integration costs, rose to GBP29.0 million from GBP22.9 million the year prior, pushing pretax profit down.
Sanne also noted that it invested in a representative sales office in India, which is expected to be operational by the end of 2018.
The company declared an interim dividend of 4.6 pence per share, up from 4.2p paid a year before.
"These results demonstrate the continuing momentum in our business and the result of the investment we are making to enhance our platforms and capabilities," said Chief Executive Dean Godwin.
"We will build on this progress in the second half of the year, given the strong new business pipeline, and remain confident in meeting our expectations for the full year," added Godwin.
The stock was trading 2.2% higher on Tuesday morning at 607.00p per share.
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