SJP raises dividend, rolls out new income fund

Added 27th July 2016

St James’s Place has increased its interim dividend by 15% despite reporting a drop in profit for the second quarter.

SJP raises dividend, rolls out new income fund

Following on the heels of its interim results, SJP also confirmed the launch of its Worldwide Income Fund to be managed by Investec Asset Management’s Clyde Rossouw based in Cape Town, South Africa.

SJP's chief investment officer, Chris Ralph, said the new equity income fund “represents an important part of our proposition to meet client demand for income-generating investments.”

SJP also announced it had rebranded several of its funds, including the Far East Fund (now, the Asia Pacific Fund) and High Octane Fund (renamed the Global Smaller Companies Fund), several of which were also treated to a fund manager shakeup.  

While the wealth manager said it is not underestimating possible knock-on effects from Brexit, it said an interim dividend of 12.33p per share was justified by strong underlying cash growth and consistent inflows.

Assets rise

Gross inflows were up by 20% to £5.3bn ($6.9bn, €6.3bn) for  the first half of the year. And SJP’s funds under management climbed to £65.6bn, a 12% increase from the start of the year and £10bn higher than the previous year.

Despite signs of positive momentum, the group’s profits were “once again impacted” by a heightened levy charged by the Financial Services Compensation Scheme (FSCS), the UK's statutory compensation scheme for customers of authorised financial services firms.

The £17m FSCS levy saw profit before shareholder tax, which reflects current applicable UK corporation tax and overseas rates, drop to £60.5m compared with £67m the year before.

The FTSE 100 wealth manager’s stock was one of the top performers during morning trading in London, rising 4.07% to 919.5p.

Confident outlook

SJP chief executive, David Bellamy, said the group remains “hopeful that the elevated levy imposed over the last two years will return to a more normalised level in future years”.

And with the introduction of SJP’s intergenerational mortgage range, an increased focus on the growth of its advisory services and other projects in the pipeline, Bellamy said he is confident about the direction the group is headed in.

“Despite continued volatility in world stock markets and political uncertainty across Europe, I am pleased to once again be reporting a strong first half performance and continued positive momentum in our business.

“Indeed, I can report that new fund flows since the referendum remain in line with those medium term objectives,” he said.

Bellamy said the company was continuing to attract established adviser businesses, often with more than one qualified adviser, to its partnership business and had also increased its advisory presence in Asia.

“Our existing partners too are investing in their own practices by recruiting qualified advisers to work for them, such that our partner numbers increased by 2.5% to 2,320 and our total qualified adviser capacity grew by 4.7% to 3,259,” Bellamy said.

“As we look ahead, I'm confident that we will find additional opportunities for growth in Asia, where our business is developing nicely and in the discretionary fund management market, through our recent acquisition of Rowan Dartington,” he added. 

Adviser growth

Bellamy also said the company was continuing to attract established adviser businesses, often with more than one qualified adviser, to its partnership business and had also increased its advisory presence in Asia.

“Our existing partners too are investing in their own practices by recruiting qualified advisers to work for them, such that our partner numbers increased by 2.5% to 2,320 and our total qualified adviser capacity grew by 4.7% to 3,259,” Bellamy said.

“As we look ahead, I'm confident that we will find additional opportunities for growth in Asia, where our business is developing nicely and in the discretionary fund management market, through our recent acquisition of Rowan Dartington,” he added. 

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