Schroders reports 18 percent increase in FY profits, acquires NewFinance Capital |
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Wed, 22 Feb 2006 06:25
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LONDON - Schroders PLC has announced that its full-year pr-tax profit increased by 18 percent to £250.7 million up from the £211.6 million reported in the last year. The profits growth was helped mainly by a 60 percent increase in profits in its Asset Management division, which was pegged at £193.9 million.
Funds under management in Schroders increased by 16 percent to £122.5 billion over the last 12 months. The company also announced that it had acquired a London-based hedge funds manager NewFinance Capital, for $101 million. The latter has $2.5 billion of assets under management and posted net revenues of $20 million in 2005.
Schroders said that the coming year would be one for consolidation. “Despite the sharp rise in most equity markets and very low bond yields, we see the favourable environment for capital markets continuing in 2006, although equity markets are unlikely to match the returns of last year,” said Michael Dobson, the company's chief executive.
“After four years of sharply increasing profits, 2006 is likely to be a year of consolidation for Schroders as we make investments for the long-term in talent, new product development and infrastructure upgrades.” But he added that the company would not shy away from new acquisition and hoped that it would increase its scope in 2006.
The company has an estimated spare cash reserve of £834 million, so analysts feel that it is in a position to look for other acquisitions after NewFinance Capital. Schroders also announced a final dividend of 14.5 pence this year up from 13.5 pence at the same time last year. This takes its overall dividend to 21.5 pence per share, up from the 20 pence per share in 2004.
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