Finance house Close Bros reported a mixed set of results for the full year with strong growth in its banking division while difficult trading conditions hurt securities.
The banking division posted a 27% increase in adjusted operating profit to £135m. Close Brothers said its loan book increased 20% to £4.1bn and the bad debt ratio improved to 1.5%.
Winterflood continued to experience low levels of market activity. Its results were affected by low retail investor risk appetite and reduced client trading activity across all sectors, particularly in the less liquid AIM and small-cap stocks, the group explained. Adjusted operating profit fell to a 10-year low of £16m from £43.2m a year before.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
The group said asset management has mostly completed its restructuring and is now positioned for future profitability. Adjusted operating loss was reduced to £4.3m from a loss of £8.6m the previous year.
Group operating pre-tax profit rose to £134.9m for the year ended July 31st compared to £78.5m the same period a year ago. Market forecasts were for pre-tax profit of £132.22m. Net interest income for the period increased to £270.9m from £230.9m previously.
Adjusted operating profit increased 2% to £134.2m and adjusted basic earnings per share increased 4% to 67.3p.
Overall, it believes it is well positioned for the current financial year.
Commenting on the results Chief Executive Preben Prebensen said: "We have achieved a solid overall performance as we continue to focus on executing our strategy and maximising the opportunity for each of our businesses in the current market environment."
"Looking forward, our strong balance sheet and the market positions of our businesses leave us well positioned for the current financial year."
The full year dividend has been increased 1.5p to 41.5p, reflecting the group's solid performance in the 2012 and confidence in future trading.
CJ
