Brewin Dolphin reports on strong first half

Brewin Dolphin Holdings posted its interim management report for the half-year to 31 March on Wednesday, with the board describing it as “another strong period” of organic fund inflows as it continued to deliver against its strategic plan.

The FTSE 250 company said total funds stood at £37.8bn as at 31 March - an increase of 6.8%, with discretionary funds at £31.5bn, increasing by 9.4%.

That compared to an increase of 6.1% in the FTSE 100 Index and a 5.4% increase in the MSCI WMA Private Investor Balanced Index, the board pointed out.

It claimed record net discretionary funds inflows, including transfers, of £1.1bn - up from £0.4bn year-on-year - representing an annualised growth rate of 7.6%.

Total income for the period was £147.4m, rising from £137.2m, with core income of £140.3m increasing by 11.3%.

Fee income was £104.7m, an improvement of 12.9%, representing 71.0% of total income, while commission income stood at £33.0m, weakening slightly from £33.4m.

Adjusted profit before tax totalled £32.4m, an increase of 14.1%, with the adjusted profit before tax margin improving to 22.0% from 20.7%.

Statutory profit before tax was £28.4m, 32.1% higher than the first half of 2016.

Basic earnings per share increased by 13.1% to 9.5p, while diluted earnings per share improved 15.2% to 9.1p - both on an adjusted basis.

On a statutory basis, basic earnings per share were 8.2p, up from 6.3p, and diluted earnings per share increased to 7.9p from 6.1p.

The board declared an interim dividend of 4.25p per share - an increase of 10.4% on the 3.85p paid at the interim in 2016.

“The group has had a successful first half of 2017 in a period with a favourable market environment,” said chief executive David Nicol.

“The delivery against our growth strategy has contributed to an excellent financial performance, with underlying earnings growth of 14.1%.

“We are exceeding the organic growth targets we set as net inflows into our core discretionary service were £1.1bn, in the period, a record and helping drive year-on-year growth of 22.1% in discretionary funds.”

In particular, Nicol said the company was capturing the near-term growth opportunities in intermediary business as a direct result of current growth initiatives which were delivering tangible results, while continuing to invest in other initiatives aimed at driving further longer term growth.

“The strength of our business and confidence in our strategy helped us in the successful acquisition of Duncan Lawrie Asset Management Limited during the period, which has been financed by surplus capital reserves and cements our position as a market leading discretionary wealth manager.”