Peel Hunt’s losses widen however agency upbeat about London listings
- Peel Hunt shares fell by nearly 4% on Thursday afternoon
In charge: Steven Fine is the chief executive of Peel Hunt
Peel Hunt shares fell on Thursday after the group unveiled an annual loss of £3.3million, amid higher costs and a dearth of listings.
Twelve months earlier, the investment bank’s loss stood at £1.5million.
In the year to 31 March, the group’s revenue increased by 4 per cent to £85.8million, amid improved investment banking fees.
Shares in the group were down 3.97 per cent or 5.5 per cent to 133.00p on Thursday, having risen nearly 30 per cent in the last year.
Basic losses per share widened to 2.7p from 1.1p in 2023, and the group did not declare a dividend for the year.
However, the company’s balance sheet remained robust with net assets of £91.8million and a 38.3 per cent increase in cash balances to £37.9million, well above regulatory requirements.
Peel Hunt said its investment banking division enjoyed growth, with revenue increasing by 39.1 per cent to £32.6million and 18 new client acquisitions, bringing the total to 150 corporate clients, including 43 in the FTSE 350.
But execution services revenue slipped to £29.6million, reflecting the broader market’s lower trading volumes.
Revenue from research and distribution fell 5.9 per cent to £23.6million, in line with market trends.
Peel Hunt said the average market capitalisation of its corporate clients jumped by 9 per cent to £752million, outperforming the FTSE All-Share Index.
RetailBook, a platform aimed at enhancing retail investor participation, received approval from the Financial Conduct Authority for its next growth phase, the group added.
Looking ahead, Peel Hunt said it was optimistic about the improving macroeconomic environment, with inflation rates falling and potential lower interest rates.
It said: ‘Public M&A is highly active across the market as bid activity in respect of undervalued UK assets continues.
‘Against this backdrop, equity capital markets (ECM) activity is beginning to build from the low levels of the last two years and, whilst the IPO market has not yet fully re-opened, UK investors are increasingly receptive to high quality companies, with Peel Hunt having acted on two announced IPOs on the London market this month.
‘Whilst challenges remain, we are becoming cautiously more confident of a broader recovery in ECM activity.’
Chief executive Steven Fine, said: ‘Despite the challenging market backdrop, revenues have grown year on year and, whilst this wasn’t quite sufficient to offset the inflationary cost environment, the business is well positioned as capital markets activity builds.
‘During the year we made good strategic progress, winning some of our largest corporate clients to date and building ever stronger relationships with our existing client base.’
He added: ‘We are seeing tentative signs that a recovery from the lows of the last two years is underway, and we are delighted to have supported two clients with their initial public offerings on the London market as announced this month.’
