Peregrine pays maiden interim dividend


Peregrine pays maiden interim dividend

Published Date: 2018-11-22 | Source: Stephen Gunnion | Author: Stephen Gunnion

Peregrine pays maiden interim dividend

The financial services and wealth management group says the payout is in line with the direction given to shareholders at the time of its restructuring.

Peregrine Holdings is paying a maiden interim dividend of 85c per share following a restructuring of the group and the unbundling of private equity and hedge fund business Sandown Capital a year ago.

Releasing results for the six months to end-September yesterday, the wealth manager and financial services group said the payout was in line with the direction given to shareholders at the time of its restructuring. Peregrine is also in the process of selling its Broking & Structuring business, which has been excluding from continuing operations for the period.

It said its results came in the face of a challenging economic environment, which it expects to continue for at least the remainder of its financial year. Within its Wealth Management business, Citadel grew core revenue by 8% to R461 million as assets under management swelled by 16% from March's levels to R50.8 billion. It said the business benefited from rand weakness towards the end of the reporting period. Headline earnings increased by 21% to R114 million.

Asset Management reported a 69% decrease in headline earnings primarily as a result of Peregrine Capital's reduced management fees earned off the back of a reduced asset base as well as lower performance fees earned as a result of performance deficits brought forward from the final quarter of the previous financial year. Peregrine Capital's asset base reduced to R6.7 billion from R7.4 billion in March, largely as a result of industry-wide redemptions out of hedge funds.

Offshore wealth manager Stenham more than doubled headline earnings to R92 million in rand terms. Excluding an ad hoc performance fee and the contribution of the division's investment in proprietary assets in the prior period, headline earnings from operating businesses rose 26% to R34 million.

Advisory business Java Capital was affected by the continued weak equity capital markets, with benign activity in the property sector in particular. It reported a 41% drop in headline earnings to R11 million.

Total operating revenue rose 2% to R789 million in the six months to end-September. Core operating revenue increased by 5% to R704 million but performance fee-related income fell 75% to R27 million. Investment and other income decreased by 95% due to the unbundling of its proprietary assets last year.

Segmental headline earnings increased by 4% to R283 million, with earnings from its continuing operations rising 31% to R206 million. These exclude its Broking & Structuring business. Annuity earnings from continuing operations increased by 15% and now make up 91% of aggregate earnings, up from 75% a year ago. It also now generates 56% of aggregate earnings offshore. Variable and performance fee earnings declined by 67% to R13 million, mainly due to the lower performance fees earned by Peregrine Capital.

Peregrine's shares ended 2.4% up at R20.96 yesterday.

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