While the investment management group’s total and discretionary funds under management increased alongside its annual revenue, it was not enough to prevent the significant erosion of the £6.1m profit recorded a year earlier.
Charles Stanley did turn in an adjusted profit before tax of £4.2m, thought this represented a 68.9% drop on the previous year’s £13.5bn.
Shareholders took a hit via the dividend, which slid 59.2% from the 12.25p recorded in the 12 months prior to 5p per share.
Underlying earnings per share dropped 47% in the same period, down from 24.98p to 13.14p, while reported loss per share fell to 13.46p.
Sir David Howard, chairman of Charles Stanley, revealed in a statement that as a result of the loss the firm is to lower its final dividend payment to shareholders to 2p per share, 78.4% down on the previous year.
Howard cited changes implemented within the company over the past 12 months – which included the appointment of Paul Abberley as CEO in June 2014, the November closure of its Liverpool office, with the Truro branch following suit and CFO James Rawlingson departing during a turbulent four-day period in January – as behind the inauspicious figures.
He said: “We are going through a significant process of change so as to refocus Charles Stanley, ensuring the continued excellence of our client service and to place ourselves at the front of the regulatory curve. There is a substantial programme of work ahead of us, but I believe that shareholders should have every confidence in the team that we have built to take this forward.”
Sunbreak
However, there were some positives in 2014-15.
Charles Stanley’s total funds under management rose to £21.3bn, 6% up on £20.1bn the previous year, while discretionary funds climbed 13% to £9.3bn.
Revenue remained relatively flat, increasing by £700,000 to £149.7m, though revenue generated by Charles Stanley Direct account holders was up 37.1%.
Paul Abberley, Charles Stanley chief executive, said: “The past year has been one of substantial change for Charles Stanley. Whilst several of the underlying elements of the results give cause for encouragement, the overall result leaves significant room for improvement.”
“As such, our immediate priorities have been firstly to ensure our staff continue to aim for the highest possible level of client delivery and secondly to address the near-term deterioration in profitability. Alongside these initiatives, we have refined our strategy to ensure that greater emphasis is placed on developing the core Investment Management business, while retaining and building only those other activities which directly complement and enhance this core activity.
“We are confident that the core activities of Charles Stanley are sound and are committed to delivering significant progress over the coming financial year.”
