European Wealth anticipating strong full-year results

European Wealth Group posted a trading update for the year to 31 December on Friday, reporting it expected revenue to be “significantly higher” than in 2015.

The AIM-traded firm said it was looking at a 21.5% increase in funds under management over the year to £1.5bn, and anticipated a boost of a further £110m of funds under management from the Towry acquisition.

Discussions were ongoing regarding repayment of a convertible loan note due in June 2017, the board said.

The board said its operational highlights included strong organic growth, the acquisition of CIMCO, and the purchase of a significant book of business from Towry, which it said opened opportunities in South Africa.

It also indicated an “encouragingly strong” performance of investment management and dealing businesses after the Brexit vote in June.

“I am encouraged by the strong growth in both our turnover and funds under management over the last 12 months,” said group chief executive John Morton.

“European Wealth continues to make selective acquisitions whilst continuing to invest in resources into the organic development of the business.”

Morton said that, whilst further progress needed to be made in the financial performance of the group, it was “very pleasing” to see the increased turnover resulting in an improved financial performance.

“The board remains committed to building a diversified wealth management business that delivers a highly professional service to clients both within the UK and internationally.

“It is clear that the introduction of MiFID II together with continued pressure on investment management fees, will create a challenging environment over the coming 12 months.

“However, being a relatively young company with modern systems, we will be able to expand our margin as the business grows and funds under management increase.”

Morton asserted that the group remained well-placed to grow both organically and through highly selective acquisitions.

“As with any growing business, it is important that we continue to invest both in our infrastructure and staff.

“With the ongoing commitment of both our staff and shareholders, we look forward to being able to continue the development of the group.”