Numis Securities Ltd.
Numis Securities Inc.
Numis has swung back in to the black, reporting rises of more than 41 per cent in stock broking commissions and fees for the six months to March.
The UK stockbroker has ridden out the market storm that engulfed rivals such as Seymour Pierce, which was bought out of administration by Cantor Fitzgerald in February.
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If, as I have suggested before, stockbroking is a question of the last man standing, then Numis Corporation is one of the clear survivors. Over the past five years it has increased the number of clients in the FTSE 250 from three to thirty-two, aided by the demise of some of the competition among the medium-sized brokers.
It would have been hard not to make money in these markets and halfway profits before tax in the six months to the end of March rose from £2.6 million to £9.2 million. The interim dividend of 4p is covered by earnings for the first time in several years. As a result, its cash pile grew from £35.9 million to £54.8 million over the first half. The company has been expanding its market share and is punching above its weight in the IPO stakes, bringing Crest Nicholson, the housebuilder, esure, the insurer, and more recently HellermannTyton, a cable equipment maker, to the stock market. Numis also has a strong position in the growing retail bond area, bringing four new issues to market in the first half.
No one can say with any certainty where the stock market is going and, clearly, any sharp correction would be bad news for Numis, but the fundamentals suggest that equities will remain in demand.
Numis shares, up 6p at 154p, are hard to value because of that lack of earnings visibility, but a maintained dividend does give the support of a forward yield of above 5 per cent, a decent enough return.
With the FTSE 100 climbing to a fresh five-and-a-half-year high, dealers certainly had cause to smile. But the traders and financiers at stockbroker Numis had more reason than most.
The City firm today revealed it had swung to a £9m pre-tax profit in the six months ending March 31, after reporting a £1.1m loss in the same period a year earlier, with business bolstered by the strong performance of UK stock markets as well as a revival in initial public offerings.
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Excellent half-year results left Numis Securities 6p dearer at 154p. The stockbroker and investment bank has been involved in 65pc of funds raised on the LSE in 2013 to date, helping pre-tax profits soar from £2.6m to £9.2m in the six months to the end of March on revenues 39pc higher at £32.4m. Its client list grew 13pc to 153 over the period
NUMIS, the City merchant bank and stockbroker, yesterday said London's resilient equity markets had helped it storm to strong half year profits this year.
The junior market listed broker, which handled the high profile floats of Crest Nicholson and Esure, has benefited from a ten per cent increase in secondary trading of FTSE stocks and more interest in initial public offerings.
"The IPO market has picked up and we've had a good share of that and built up our client base," chief executive Oliver Hemsley said. "The equity market is buoyant at the moment. Obviously there's always nervousness but markets are relatively fair."
Revenues rose 39 per cent to £32.4m, delivering an adjusted pretax profit of £9.2m for the six months ending March versus £2.6m a year ago.
Hemsley added that despite increased market sentiment and more business activity there was still too much capacity in the City stockbroking sector.
Profits at the stockbroker and investment bank Numis more than trebled in the past six months as stock markets soared and share flotations made a comeback.
Oliver Hemsley, the company's chief executive, said: "My view is that equities will continue to perform well and that institutions have a lot of money coming in, some of which will end up in stock markets and initial public offerings."
Pre-tax profits soared from £2.6m to £9.2m in the six months to the end of March on revenues up 39 per cent at £32.4m. Shares rose 6p to 154p.
Any fool can make money in rising markets, runs the old adage.
So no great surprise today that Numis Corporation managed to treble its pre-tax profits in the six months to March.
Not that I am suggesting chief executive Oliver Hemsley and his colleagues are in any way fools. In fact, Hemsley and co are far from stupid. They have realised that there is still room out there for niche players and that well-capitalised, well-funded corporate brokers can not only survive but also prosper when the going is good.
Numis now has 153 corporate clients, having added 18 in the last six months. It has also batted above its weight in terms of advising on flotations and retail bond issues. Hemsley makes the point that more and more corporates are now looking for independent financial advice outside the ranks of the big banks. There is also some evidence that those same big banks have been pulling back, particularly in areas such as sales and trading in medium-sized companies’ shares.
It is impossible to say that all brokers in the City are enjoying the boom. Those that are well managed and soundly funded, like Numis, Panmure Gordon and Canaccord Genuity, are almost certainly faring well as they grab at least their fair slice of the action.
But there are still firms out there that have been unable to take advantage of the upturn. I cannot, of course, name names.
In the meantime, Numis does not reveal bonuses at the halfway stage. They may not have trebled but I bet they are a lot better than last year.
Profits at stockbroker and investment bank Numis more than trebled in the last six months as stock markets soared and share flotations made a comeback.
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At a well attended conference at the London Stock Exchange yesterday, prolific lead manager Numis Securities painted a very positive picture of the future prospects for the UK retail bond market.
An eclectic mix of past and potential issuers, lead managers, brokers and wealth managers enjoyed a series of positive presentations from key industry participants and were left with the overwhelming message that this was a sector on the up.
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Working on the flotations of Crest Nicholson, esure and most recently HellermannTyton helped corporate stockbroker Numis enjoy a bumper start to the year.
Today it said pre-tax profits and revenues for the six months which end on Sunday will be “substantially above” the same period last year when it made profits of £4.1 million.
“What we are seeing is an appreciation of the difference between the big investment banks and strong independent brokers like us,” said chief executive Oliver Hemsley. “We have not only seen good corporate business but also a very strong performance in our secondary markets, where we are handling more and more big block trades.”
The half year also saw Numis appointed as joint broker to Daily Mail and General Trust, taking its brokerships to FTSE 350 companies to 30.
Numis shares jumped 7.5p, or 5%, to 151p.
Numis Corporation PLC: Expect to report revenues and profits substantially above the same period last year.
Numis Corp. says activity in all areas of its business has strengthened since Feb. AGM.
* Sees rev., profit “substantially above the same period last year”
* Co. to report profit for six months through March 31 on May 7
Numis Corporation PLC said Wednesday that activity in all areas of its business strengthened since its February AGM, and said it expects to report revenue and profit for the six months ended March 31 substantially ahead of the same period last year.
MAIN FACTS:
-Reports marked improvement in both secondary and primary income
-Shares closed Tuesday at 144 pence valuing the company at GBP165 million.
UK private equity firm Doughty Hanson is understood to have more than doubled its money by floating a stake in portfolio company HellermannTyton – a deal which marks the third successful financial sponsor-backed IPO in London in under a week.
Goldman Sachs and JP Morgan Securities acted as joint global co-ordinators and joint bookrunners on the offering. Numis Securities is acted as lead manager.
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CABLING products-maker HellermannTyton is planning a London listing at the end of this month to raise £35 million to finance its growth.
The group, which wants to increase its manufacturing space by 40%, said the offer will comprise new and existing shares. Hellermann's private-equity owner Doughty Hanson will sell some of its stake.
The company makes cable-management products, used for fastening, insulating, routing and connecting components in cables for the electrical, automotive and datacom markets.
The business, established more than 70 years ago, has been operating internationally for four decades, with sales bases in 34 countries. About half its sales come from Asia and the Americas.
Goldman Sachs and JPMorgan are acting as joint global co-ordinators and book-runners, with Numis Securities as lead manager.
In the dog eat dog world of stockbroking, there can be no doubt that Numis, 1p off at 146p, is on a roll. Yesterday’s successful placing of St Modwen stock followed hard on the heels of its involvement in the successful return to the main market of housebuilder Crest Nicholson, 2p easier at 262p. It is also one of the lead advisers to motor insurer eSure, which is accelerating towards a £1bn flotation.
Numis had 70 corporate clients in 2007 with an average market capitalisation of £165m and now services over 150 with an average market cap of £400m.
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By the time brokers packed down in front of their screens this time last week, another of their industry’s superannuated shops had disappeared.
Seymour Pierce, which could trace its name back to 1845, had been mopped up by a bull-necked New Yorker 100 years its junior.
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Numis won "BEST ADVISOR - CORPORATE SPONSOR" at tonight's UK Stock Market Awards 2013 beating four other nominees, Canaccord Genuity, Cenkos, FinnCap and JP Morgan Cazenove.
Our client ASOS won "Best Retail PLC", Rightmove "Best Media PLC", St Modwen Properties "Best Real Estate PLC" and Hargreaves Lansdown "Best Financial Services PLC".
An array of stock market flotations that were delayed during the financial crisis are now tipped for revival after Crest Nicholson, the housebuilder, completed the largest public listing in London so far this year at £553m.
Crest Nicholson, which builds upmarket homes mainly in the south of England, had become one of the most high-profile victims of the financial crisis after being taken over by its lenders in 2009. But its successful return to the market at 220p a share brings to an end a painful five years of restructuring.
The float - the biggest listing since Direct Line last October - sparked hopes of a revival in London's moribund IPO market.
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The stock market displayed another symptom of a return to better health as a hefty flotation got away. Crest Nicholson, the higher-quality housebuilder taken private at the top of the market six years ago, staged a decent enough return. Shares were priced at 220p, towards the top of the range, and, after the first day of dealing exclusively among the big City investors, they pushed to 255p. That valued London's biggest flotation since Direct Line in October at more than £600 million. Helped by Barclays, HSBC and Numis, Crest raised nearly £225 million, £56 million by selling new shares and the balance from sales by existing shareholders, including the distresseddebt hedge fund Varde and Deutsche Bank. Crest's return comes after a painful five-year absence, when it came close to collapse under its large debt pile. In 2007, Sir Tom Hunter, then said to be Scotland's richest man, and HBOS led the consortium to take Crest private. It was a disaster. Two debt restructurings delivered Crest into the control of Varde and Deutsche. Crest, founded in 1963 and employing nearly 600 people, should secure a spot in the FTSE 250 at the next index reshuffle. Its return also offers hope to other private companies whose ambitions to list were thwarted in recent years by foul markets and insipid demand. New Look, the fashion retailer, Merlin Entertainments, the owner of Alton Towers and Legoland, and Travelport, the airline ticketing firm, all pulled big share sales. New real estate flotations in particular have been rare, with only a handful taking place since the market crashed in 2009.
Gurus at Numis Securities expect a mergers and acquisition explosion this year because, following a five-year period of debt reduction, many companies are now carrying substantial gross cash balances earning negligible returns. They all remained prudent in 2012 but are now ready to push the boat out to increase capital returns for shareholders.
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BARCLAYS Capital and HSBC acted as joint sponsors, joint global co-ordinators and joint bookrunners on Crest Nicholson's initial public offering. Derek Shakespeare, a managing director at Barclays' investment banking division, is leading the effort for the bank. He recently advised Redraw founder and chairman Steve Morgan's vehicle Bridgemere and fund manager Tosca on their bid to take over the housebuilder, which was eventually pulled. He is joined by Chris Madderson, part of the bank's UK origination team and Ben West in the equity syndicates team. HSBC's advisory team was led by Nick Donald, head of equity capital markets (ECM). His previous deals include acting as joint bookrunner for miner Lonmin on its $817m rights issue in November. Simon Cloke, head of diversified industries at HSBC and ECM director Stuart Dickson worked with Donald on the deal. Norton Rose, the law firm also acted for Crest Nicholson, with corporate partners Mark Lloyd Williams and Tom Vita leading the team. Norton Rose also recently advised the consortium led by Malaysia's SP Setia that bought Battersea Power Station last year. Meanwhile broker Numis is lead manager on the listing while Lazard & Co is financial adviser to Crest Nicholson.
HOUSEBUILDER Crest Nicholson made a triumphant £553 million stock market return today as major investors piled into the biggest float of a British company since the launch of insurer Direct Line last October.
Demand for Crest's shares was such that the 50-year-old firm got the float away near the top end of the expected range, at 223p. Institutional investors immediately sent the price roaring more than 10% higher as nine million shares changed hands in the first minutes of "grey market" trading.
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Crest Nicholson this morning set a price of 220p a share for its London IPO, valuing the company at £553m. The property group said today it expected to raise gross proceeds of around £224.9m, comprising a primary component of £56m and secondary sales of £168.9m from existing shareholders. The shares will start trading on the London Stock Exchange this morning under the ticker CRST. The 50-year-old firm said it would return to the stock market on 21 January, five years after it was taken over as a result of the market crash. Barclays and HSBC acted as joint sponsors, joint global co-ordinators and joint bookrunners in relation to the offer. Numis acted as lead manager while Lazard was the financial adviser.
For a business that has just completed its fifth year of challenging markets, Numis Corporation sounded surprisingly chipper at the broker’s annual meeting yesterday. It has more than 150 corporate clients and a good position in the retail bond market. No one knows where the market rally will end, but, with £50 million in the bank, at least Numis will not have to go cap-in-hand to creditors, unlike other less well financed rivals.
In the dog eat dog world of stockbroking, Numisis more than holding its own. It rose 6.5p to 138p after reporting it has made an encouraging start to the year with revenues well ahead of last year.
Chairman David Arculus told the AGM it has been achieved by an increase in institutional commissions and improved trading. There have also been signs that the IPO market could be springing back to life.
Numis says that there has been an encouraging start to the year with revenues well ahead of the same period last year.
Chairman, Sir David Arculus, told shareholders at the AGM: "Despite having to contend with a fifth successive year of extremely tough market conditions, Numis again produced an acceptable result in 2012 given the challenging background.
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In the FTSE 250, Numis has been attracting clients and is now the fourth-largest broker in that index. According to Financial News’ analysis, Numis is the most improved broker, winning numerous clients from larger rivals. David Poutney, co-head of corporate broking at Numis, said: “There is a tendency from the bulge brackets to be more interested in fees and not service, so we have a lot of drop-offs from bulge brackets. People want stability; they want to know that their broker is going to be around.”
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2012 was a spectacular year for investors in small and mid-sized UK companies” according to London Business School emeritus professors Elroy Dimson and Paul Marsh, authors of the Numis Smaller Companies Index Annual Review, which was published today by Numis Corporation.
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Shares in small companies trounced their larger rivals in the year to December with gains of 29.9% according to the smaller companies index compiled for Numis Securities by Elroy Dimson and Paul Marsh of the London Business School.
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Shares in Britain’s smaller companies raced ahead of their larger listed peers last year, according to analysis by Numis.
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Call it the small-cap effect or call it a dash for trash, smaller capitalisation stocks are setting new records in the UK and US.
The argument for the US seems simple. Small caps are more exposed to the domestic economy than large companies and the US economy has been growing, if only slowly. But this does nothing to explain the performance of British smaller companies. They, too, are more exposed to the domestic economy which fell into a surprise double-dip.
Yet, UK small caps have beaten their US cousins in the past year. The Numis smaller companies index, excluding investment companies, returned 34 per cent (including dividends) since the start of 2012. In the US, the Russell 2000 returned 21 per cent.
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Volatility in equities is leading British retail investors to rethink their traditional devotion to shares and they are now a willing target of financial and non-financial borrowers raising money through the Order book for Retail Bonds.
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Stockbrokers have had little reason to cheer in the past year. Several industry players have been taken over by larger groups – making it harder for those remaining to win the confidence of new clients – and UK equity trading volumes have remained depressed.
But the UK’s nascent retail bond market is providing several brokerages with some respite.
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FinnCap has underlined its growing popularity as a small-cap broker by overtaking Cenkos Securities at the top of a ranking of intermediaries serving London’s junior market.
Canaccord Genuity retained its third place in the client numbers table, despite losing five Aim clients, while Numis Securities took the top place in the rankings based on clients’ market capitalisation.
The collective valuation of Numis’s clients increased 14.6 per cent to £6.7bn. However, Numis failed to make it into the top five brokers by Aim client numbers.
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Oh, for an equity index that doesn’t have the semi-nationalised banks that decimated equity markets during the financial crisis or the heavily cyclical miners that are damaging returns now. Sadly, there is no FTSE 100 index of so-called British blue-chips with the scary bits filtered out. There is, however, an alternative: the index of smaller companies listed on the main market. It doesn’t have much by way of banks or miners and it has been outperforming.
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The London Stock Exchange said that the value of UK shares traded had fallen by a fifth in the last 12 monthsfrom an average of £5 billion a day to £4 billion a day. It also said the number of? companies which had floated on its main and junior market had almost halved, falling from 86 to 45.
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STOCKBROKER Numis yesterday forecast a 20 per cent increase in revenues for the second half of the year compared to the first half, bucked up by an increase in deal related income from equity transactions and M&A deals.
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The first IPO in the pharmaceuticals industry for five years saw Clinigen get off to a healthy start on AIM. Placed at 164p by broker Numis, the shares raced ahead to touch 177.25p before closing at 176p. The UK-based company has offices in the US and Japan. The £6.6m funds raised will help the company develop both organically and through acquisitions of new pharma products.
Clinigen, a pharmaceuticals services group, ended its first day on Aim up 6.1 per cent at 174p. Clinigen raised £50m through Numis Securities with a placing to institutions at 164p a share, which gave the company a market value of £135m.
Weak trading volumes hit revenues at the London Stock Exchange and ICAP over the summer as Europe’s debt crisis continued to weigh on sentiment.
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Pharmaceuticals group Clinigen today announced a rare flotation on Aim. The company, which specialises in hospital-only medicines, is raising £50 million.
Clinigen shares will start trading on the junior market next Tuesday, with its placing by broker Numis at 164p per share giving it a market capitalisation of £135 million.
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Bloomberg - As Avast Software NV planned its initial public offering last year, Chief Executive Officer Vincent Steckler considered listing the Czech anti-virus software maker in London before finally settling on the Nasdaq Stock Market in New York. U.K. Prime Minister David Cameron doesn’t want that to happen again.
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A supplier of drugs for medical trials is to become the first pharmaceutical company to float in London for five years. Clinigen will be valued at about £170m when it lists on AIM, the junior London market.
The move will allow Andrew Leaver, Clinigen's founder, to sell most of his stake. He is expected to make about £75m by selling three-quarters of his 64% holding.
Volatile markets have led to a dearth of floats this year, with few companies prepared to brave the stormy conditions. However, Clinigen believes its growth record will appeal to investors and it is likely to announce plans to go public this week.
The company hopes to raise more than £10m of new money, which will be used for acquisitions. It wants to snap up drugs from larger pharmaceutical companies that it can sell in new markets or adapt for different uses. It has successfully done this with Foscavir, an antiviral medicine bought from Astra Zeneca.
Supplying drugs for clinical tests provides almost 75% of Clinigen's £82m revenues. Many trials compare an experimental drug with one already on the market. Clinigen, led by Peter George, chief executive, supplies the latter for large-scale studies to ensure consistency.
Leaver, 49, will be replaced as chairman by Peter Allen, who chairs Prostrakan, the Scottish drugs company. Numis, the broker, is handling the float.
The Alternative Investment Market has had a rough time recently.
When it was formed in 1995, the function of Aim was simple: give small, fastgrowing companies easy access to capital - and let investors in on the action.
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HMV, the UK entertainment retail chain, has employed Numis as its financial adviser and corporate broker, as the firm continues to review its business structure. It marks Numis’s fourteenth broking mandate win in the past 10 months.
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In the UK Small & Midcap Survey, there were two overall categories:
As voted by Companies, Numis was ranked No.1 (unchanged), ahead of Investec (No.2, unchanged) and Espirito (No 3, unranked)
As voted by Institutions, Numis came No.2 (up from No.3), after Investec (No.1, unchanged) and Peel Hunt (No.3 down from No.2)
In addition, there were three separate categories for Sales, Trading, and Corporate Broking within the Institutional survey:
- Corporate Broking: Numis (No.1 from No.3), Investec (No.2 from No.1), Peel Hunt (No.3 from No.2)
- Sales: Numis (No.1 from No.4), Investec (No.2 from No.1), UBS (No.3 from No.5)
- Trading: Investec (No.1 unchanged), Numis (No.2 from No.4), Charles Stanley (No.3 from No.6) Analysed by Research sector within the UK Small & Midcap Survey, Numis was voted No.1 in 6 sectors (up from 2 last year) and Top 3 in 9 sectors (up from 5 last year):· Alternative Investment Funds: No.2
· Chemicals Team: No.3
· Construction Team: No.1
· Financials Team: No.1
· Insurance Team: No.1
· Leisure Team: No.1
· Media Team: No.1
· Mining Team: No.3
· Technology Team: No.1
In the Pan-European Survey, Numis came 5th (up from 6th) overall for UK Leading Brokerage Firm
London's reputation as a global centre for capital markets suffered another blow yesterday when a third company pulled its planned London Stock Exchange listing in the space of a fortnight.
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Strong returns from international smaller companies funds mean that small-cap outperformance of larger-cap stocks is now a global phenomenon.
Smaller cap funds dominate the best-performing Investment Management Association (IMA) sectors over three years, with UK Smaller Companies, North American Smaller Companies and European Smaller Companies riding in first, third and fifth places respectively, according to Trustnet data to May 10.
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Whatever happened to the notion of Lehman Sisters being a safer pair of hands? The latest research from the Bundesbank suggests that a greater proportion of women on bank boards has led to “a more risky conduct of business”, before citing “lack of executive level experience” as the cause. It was ever thus. Women take time out to have babies! Similarly, the Norwegian experiment with introducing quotas in 2004 failed because of the time constraint imposed on achieving the 40 per cent target – boards ended up filled with inexperienced heiresses and wives.
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UK Stock Market Awards 2012 - Winners - Best Advisor - Corporate Sponsor: Numis Securities
The UK Stock Market Awards 2012, organised by StockMarketWire, celebrate all that is great about UK PLCs and seek to answer the big question - "which companies are actively riding the wave and which companies are being swept along by sentiments?"
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Numis has agreed to take over the Hoare Govett Smaller Companies Index from Royal Bank of Scotland, as it seeks to build on its position as London’s second-biggest stockbroker by number of corporate clients.
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Numis Corporation has taken over the Royal Bank of Scotland’s Hoare Govett Smaller Companies Index, which acts as a benchmark for UK small-cap investing. The index will be renamed the Numis Smaller Companies Index with immediate effect.
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Jefferies International may have bought Hoare Govett from RBS but it did not acquire everything associated with the illustrious broker.
Numis Securities has bought the Hoare Govett smaller companies index, to be renamed the Numis Smaller Companies Index at once, with Professors Paul Marsh and Elroy Dimson of the London Business School continuing to compile it.
The big institutions largely gave up on small-caps more than a decade ago, concluding that researching them was too much of a hassle, but data supplied by Numis yesterday bears out their worth. £1 invested in the index back in 1955 would now be worth £3,459.
That compares with just £648 had it been invested in the FTSE all-share.
Is it better to pay for your drinks by the round or run up a tab that you pay off at the end of the night? Corporate broking faces a similar dilemma. Should corporate brokers charge clients an annual retainer or offer the service for free in the hope of winning underwriting and M&A business at a later date?
Investment banks certainly seem to believe that corporate broking is a useful string to have to their bow.
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Equity research teams are being used to spearhead a fresh battle between boutique investment banks and their bulge-bracket rivals.
Some think the mid-sized brokers are fighting a losing battle and that the market, starved of fees, will polarise between the very big and the quite small.
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The rise in the market since the start of the year — the FTSE 100 has risen by 4 per cent thus far, so it has recovered more than two thirds of last year's losses — has not been accompanied by any increase in the volume of shares traded, as one might have expected. Plainly, while brokers are marking shares higher, no one thinks the rally is going to be maintained, and there is every chance that in due course we will be back where we started.
Numis Corporation, one of our more successful middle-ranking brokers, told the market yesterday that the performance to date, since the start of the new financial year in October, was in line with the same period of the previous year, with revenues and market share marginally ahead. The broker has added new corporate clients in each of the past 13 quarters and is second to, if a long way behind, the market leader, JPMorgan Cazenove, in the number of companies on its books.
That trading update is, with respect, not saying much. Those takeovers in the sector — Investec buying Evolution, with others still going through — must have taken capacity out of the market, to the advantage of the survivors. I suspect that in two or three years we will have about half a dozen brokers serving the mid-cap market, and Numis, with almost £50 million in cash in the bank, will be one of them. But those two or three years will be tough — just like the past two or three.
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London’s stockbrokers are shrinking as Europe’s sovereign debt crisis and competition from international firms squeezes revenue and fees.
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RBS HOARE Govett, the broking arm of RBS, shed another key client yesterday when insurer Amlin said it had switched advisers. Amlin, the biggest Lloyd's of London insurer by market value, announced it had appointed Morgan Stanley and Numis Securities as its new joint brokers - replacing RBS Hoare Govett which had previously been its sole adviser. Over the weekend it was revealed that RBS is considering selling or closing its broking business as part of a scale down of its equities operations, and this latest loss of a FTSE 250 mandate could be a further blow to its future. An Amlin spokesman declined to comment on a reason for the switch yesterday.
JON Moulton is set to take advantage of Britain's faltering economic recovery with the launch of his second turnaround fund. The legendary private equity boss plans to raise up to £200m to invest in struggling companies through Better Capital Fund II. Moulton launched the first fund two years ago, after quitting Alchemy, and went on to invest in firms such as boatmaker Fairline and Reader's Digest. Yesterday Better Capital chief executive Mark Aldridge told City AM the 2012 fund would invest sums of up to £75m to take controlling stakes in British or Irish firms over the next two years. "We are looking at businesses in financial difficulty which can be turned around. We don't invest on the basis of assuming further growth.' Moulton said there will be more chances to invest as banks cut support to distressed firms. The fund has raised £158m, which will be increased by up to £42m. Numis has acted as sponsor, financial adviser, broker and global coordinator.
Numis Corp., the London-based stockbroker, swung to a full-year operating profit of 1.8 million pounds ($2.8 million), excluding a one-time litigation charge, as the company boosted trading commissions.
That compares to an operating loss of 474,000 pounds the previous year, the company said in a statement today. Revenue rose 4 percent to 54.2 million pounds after an 11 percent increase in trading commissions to 29.3 million pounds. That came as average trading volume in the FTSE 100 Index fell by 10 percent on the previous year.
In the context of difficult market conditions, to increase revenue and operating profit was a reasonable result,”
Chief Executive Officer Oliver Hemsley said in a telephone interview. “It demonstrates our ability to attract corporate clients and capture market share.”
London’s stockbrokers are struggling as the sovereign-debt crisis roils markets, forcing companies to delay initial public offerings and investors to cut the number of shares they trade. Evolution Group Plc said Nov. 18 it will post an operating loss after third-quarter investment-banking income fell “considerably.” Tim Linacre, CEO of Panmure Gordon & Co., stepped down Nov. 30 after the U.K. broker announced it would report a loss because of “severe market turmoil.
Numis had a net loss of 671,000 pounds after paying a 2.2 million-pound litigation charge relating to a 2007 fundraising for Canadian oil company Rock Well Petroleum Inc., according to the statement. That compared with a net loss of 101,000 pounds the year earlier.
The company’s shares rose 2.4 percent to 86 pence at 10:20 a.m. in London trading, giving Numis a market value of 95.6 million pounds.Numis Corp., the London-based stockbroker, said its loss for the year increased to 671,000 pounds ($1 million) from a year earlier because of a one-time charge for litigation.
That compared to a loss of 101,000 pounds the year earlier, the company said in a statement today, including a charge of 2.2 million pounds for the litigation cost. Revenue rose 4 percent to 54.2 million pounds.
“The current year is unlikely to be less challenging than the last, but our ability to provide high-quality execution and genuinely independent advice to our growing client base provide the platform for long-term success,” Chief Executive Officer Oliver Hemsley in the statement.
London’s stockbrokers are posting losses as Europe’s sovereign-debt crisis roils markets, forcing companies to delay initial public offerings and investors to cut the number of shares they trade. Evolution Group Plc said Nov. 18 it will post an operating loss after third-quarter investment-banking income fell “considerably.” Tim Linacre, CEO of Panmure Gordon & Co., stepped down Nov. 30 after the U.K. broker announced it would report a loss because of “severe market turmoil.”
"This market is seriously overbroked," Oliver Hemsley, chief executive of broking firm Numis, declared today.
"Our industry remains blighted by overcapacity. "There is still a mismatch between the number of market participants and available business. But in recent weeks we have seen that people are slowly but surely coming out of the market and we will benefit from that."
Headline profits rose 13% to £8.9 million in the year to September with institutional broking and M&A fees up but flotation fees well down. The firm advised on just three initial public offerings - Betfair, CatCo and Circle Holdings - last year, down from six a year earlier. Including secondary issues, the amount Numis raised for its clients more than halved from £1.3 billion to £634 million. Numis' 181 staff shared pay and bonuses of £29.2 million, marginally down on the previous year's £29.7 million. The full-year dividend is unchanged at 8p a share.
Winning 26 new corporate clients last year and another six since the year end means Numis, with 146 clients, now ranks second only to JP Morgan Cazenove in corporate broking.
Hemsley said: "The current year is unlikely to be less challenging than the last."
* City wealth manager Brewin Dolphin's pre-tax profits fell 27% to £21.9 million last year after it was hit by a £6 million Financial Services Compensation Scheme levy following the Keydata scandal.
"That's water under the bridge," said chief executive Jamie Matheson. "What matters now is that the regulators get the support which will help them spot that kind of thing much earlier." Brewin increased funds under management from £23.2 million to £24 million.Stockbroker Numis posted a 13 percent rise in full-year pretax profit driven by a near doubling in its mergers and acquisition deal fees, but said it saw no near-term change in difficult market conditions.
The firm, which focuses on small to mid-cap clients, said adjusted profit before tax increased to £8.9 million in the year to end-September. Revenue was 4 percent higher at £54.2 million. Fees from mergers and acquisitions jumped 94 percent to £9.3 million from £4.8 million last year.
"Numis has delivered a creditable performance against a background of huge economic uncertainty, highly volatile markets and unrelenting competition," said Oliver Hemsley, Numis' chief executive, in a statement. "We see little change to these conditions in the near term." Top brokerages have navigated choppy waters in the last few months, as clients flee volatile markets for perceived safe havens such as commodities or currencies. That has dampened demand for brokers' services.UK mid-cap broker Numis Securities reported an increase in operating profits last year, bucking a tough trading environment that has taken its toll on many of its peers. The firm was only prevented from ending the year in the black by a one-off litigation charge of over £2m.The company this morning reported its results for the 12 months to September 30, a year in which revenues increased by 4% to £54.2m and operating profits reached £1.8m, up from a loss of £474,000 in 2010. However, Numis was hit by an exceptional non-recurring charge of £2.2m. In July, the company settled a legal claim brought by asset manager Fidelity in relation to a private placing of shares in Rock Well Petroleum. As a result, Numis's losses after tax reached £671,000 for the year. Despite the loss, Numis doubled its fees from mergers and acquisition advice, generating £9.3m from deals it worked on over the period. This figure was up from £4.8m in 2010. Oliver Hemsley, chief executive at Numis, said: “M&A is an increasingly large part of our business.” Hemsley added that despite the current market conditions and swingeing job cuts in the City of London, Numis would be looking to add to its ranks in 2012: “We would defiantly try and attract good people to the firm [in 2012], because when times are tough is one of the times you can build the business. This is one of the benefits of having a very strong balance sheet.” Hemsley, however, is not holding out for an improvement in equity capital markets. He said: “Numis has delivered a creditable performance against a background of huge economic uncertainty, highly volatile markets and unrelenting competition. We see little change to these conditions in the near term.”UK broking firms such as Evolution Group, Arden, Matrix and finnCap have all cut staff numbers on 2011. Collins Stewart and Panmure Gordon have also reported losses.Hemsley said: "With any luck it will become marginally less competitive, but there are plenty of able and well capitalised investors out so we will have to put our foot to the floor. This industry is always competitive." Numis also said it was keeping costs under control during a difficult year. Simon Denyer, finance director at Numis, said: “Staff costs are in line with last year. Non-staff costs are where we have been trying to concentrate our efforts.” Numis paid £851,000 in tax for the year to 2011.
* FY adjusted pretax profit up 13 pct to 8.9 mln stg
* To pay final dividend of 4p, total unchanged at 8p
* Says market conditions to remain difficult
British stockbroker Numis Corp posted a 13 percent rise in full-year pretax profit driven by a near doubling in its mergers and acquisition deal fees, but said it saw no near-term change in difficult market conditions.
The firm, which focuses on small to mid-cap clients, said adjusted profit before tax increased to 8.9 million pounds ($13.9 million) in the year to end-September. Revenue was 4 percent higher at 54.2 million pounds.
Fees from mergers and acquisitions jumped 94 percent to 9.3 million pounds from 4.8 million pounds last year.
"Numis has delivered a creditable performance against a background of huge economic uncertainty, highly volatile markets and unrelenting competition," said Oliver Hemsley, Numis' chief executive, in a statement. "We see little change to these conditions in the near term."
Top brokerages have navigated choppy waters in the last few months, as clients flee volatile markets for perceived safe havens such as commodities or currencies. That has dampened demand for brokers' services.
The company maintained its final dividend at 4 pence per share, giving a total of 8 pence -- the same as 2009 and 2010. ($1 = 0.6410 British pounds) 7:19 AM
Numis Corp PLC * Statutory profit before tax of £0.2M (2010: £0.2M) * Revenue of £54.2M, up 4% (2010: £51.9M) * Sees little change to uncertain, volatile conditions in the near term * The first two months of new financial year have seen no improvement in market conditions * Industry remains blighted by overcapacity, but in recent weeks there are signs that this is finally beginning to reduce * Expects low levels of activity to persist for some time * The current year is unlikely to be less challenging than the last
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IT was the best of times and the worst of times for two of the City’s stockbrokers as they issued contrasting results.
Charles Stanley cited market volatility as it warned profits for the first half would be down on the same period last year. But independent broker Numis saw revenues rise by 6pc across the six months on last year’s performance. Shares in Charles Stanley dropped by 23.4p to 245p after the group issued its trading update ‘in the face of increasingly strong macro-economic headwinds’. Falling commission levels and corporate finance fees have impacted its securities arm, and the effects of inflation will hit overall profits, it said.
Meanwhile Numis (up 1p at 90p) reported trading revenues had seen ‘double digit percentage growth year on year’. Chief executive Oliver Hemsley said: ‘Numis has performed well against a background of huge economic uncertainty, highly volatile markets and unrelenting competition.’
HERO...AND ZERO
WITH Oliver Hemsley, left, at the helm, Numis has sailed through the stormy economic waters seemingly unhindered. While competitors have floundered, the independent broker group has seen strong growth and kept costs down. The headwinds have battered Charles Stanley into admitting profits will be lower this year. Ship’s captain Sir David Howard is being opaque over the figures, and we’ll only know how bad the damage is when the storm clears.
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Numis star Alex Ham, 28, is "quick on the phone and supplies a lot of background information". He ran the broker's involvement in the Horizon and Betfair IPOs and advised Investcorp on its bid for Opsec.
SHORTLIST • Sam Smith, Finncap • Billy Clegg, Financial Dynamics • Oliver Holbourne, Bank of America Merrill Lynch • Leanne Hoare, Linklaters. Sponsored by Alpari.NEWS | IN BRIEF Numis hires former Amazon exec Investment bank and broker Numis has taken on Brian McBride, the former head of Amazon's UK operations, to sit on its advisory board. Numis set up the board to give the firm access to industry experts in a bid to widen its business. McBride follows in the footsteps of former BP chief executive and Vallares boss Tony Hayward, who joined the board in July.
Numis: Brian McBride, Amazon's former UK managing director, has been appointed to the advisory board of Numis, joining ex-BP chief Tony Hayward.
BP's former chief executive Tony Hayward has joined the board of Numis as the first member of the investment bank and stockbroking firm's new advisory board.
Hayward is also a non-executive director at TNK-BP, a senior independent director at Glencore, and a co founder of oil and gas investment vehicle Vallares with Nat Rothschild.
The Independent
Business Briefing : Tony Hayward to advise Numis By Nikhil Kumar
The Daily Telegraph, 09-07-2011
Hayward adds Numis role to his growing portfolio By Philip Aldrick
TONY Hayward, the former BP chief executive who stepped down in the wake of the Gulf of Mexico oil spill, is to join stockbrokers Numis as he continues to amass directorships in the City. After leaving the oil giant last year, Mr Hayward indicated he wanted to build a diverse portfolio of corporate interests and has already proved highly successful. He has retained a non-executive post at TNK-BP, BP's lucrative Russian joint venture, become senior independent director of Glencore, the world's largest commodities trader, and has jointly founded oil and gas investment vehicle Vallares with financier Nat Rothschild. He can now add Numis to his roster of appointments, where he has agreed to become the first member of the investment bank and stockbroking firm's advisory board. Numis was attracted by Mr Hayward's business experience and contacts book, a spokesman said. "The purpose of the advisory board is to assist Numis to grow its business and reputation in the market place, and Numis is looking to attract contemporary business people with unparalleled experience in their field," the company said. Numis non-executive directors are paid £50,000, though Mr Hayward is expected to receive less - reflecting the limited responsibility of the role. He is already being paid about £150,000 a year at Glencore and could share in a £410m windfall as the result of a £15m investment by three founders of Vallares, which he is running. His remuneration as a non-executive director of TNK-BP is not disclosed. Mr Hayward left BP under a cloud after the Deepwater Horizon catastrophe which caused the death of 11 oil rig workers and one of the largest ever oil spills. His public handling of the crisis made him a hate figure in the US, where he came under personal attack from politicians and the public, but he retained a loyal following in UK circles. Numis wants to establish an advisory board with half a dozen heavyweights in fields that chief executive Oliver Hemsley and his team believe will be important growth areas in the years ahead. Mr Hayward's appointment reflects Numis's intention to build a strong presence in oil and gas. Other targeted sectors are said to include online and financial services, and other leading industry figures are being approached. The advisory board will not have any management responsibility. Members will meet four times a year and provide introductions when Numis requires them. Mr Hayward is certainly well-connected. He is expected to attend Nat Rothschild's 40th birthday party in Montenegro this weekend, which is likely to be one of the society events of the year.
The Times, 09-07-2011
Need to know Banking & Finance : Numis: Tony Hayward, the former chief executive of BP, will join the advisory board of Numis Securities. The stockbroker said that the appointment would help it to develop its business and reputation in the City.
The Times, 09-07-2011
Numis hires Hayward
The former BP chief executive Tony Hayward is to join the advisory board of the stockbroker Numis Securities. Mr Hayward has picked up several directorships, including one at Glencore, after stepping down from BP last year in the wake of the Deepwater Horizon disaster, which caused the worst oil spill in US history.
Having just settled with Fidelity about a dispute over the placement for a Canadian oil company, Numis is to announce that former BP chief Tony Hayward is to become the first member of its new advisory board.
Mr Hayward, who has launched his investment vehicle Vallares and is the senior independent director of Glencore, will advise the small and mid-cap broker on oil and gas.
Numis - led by chief executive Oliver Hemsley, Lorna Tilbian, executive director, and Simon Denyer, finance director - is currently talking to various executives in a range of sectors to act as advisers.
New entrants in corporate broking have jolted the established order to reassess their businesses as corporates are forging new long-term relationships. But the winners in the latest land-grab will be banks that can convert headline-making broking mandates into revenues. David Rothnie reports.
In a world where investment banks are seeking to capture global capital flows and grab market share in fast-growing emerging markets, investing in corporate broking might seem low down on the priority list. In fact, it remains one of the most competitive areas of banking and is a central plank of every global firm's UK strategy. Corporate broking is the means by which banks fight for supremacy in UK investment banking, which is the biggest fee pool in Europe. It is not just that every big bank has a corporate broking business, but more that it is impossible to break into the top five without a presence in corporate broking. It is in the throes of its fiercest battle due to a confluence of factors. New entrants are shaking up the established order by targeting their client lists and through aggressive poaching raids. And where they cannot break the hammerlock on the most prestigious broking accounts, they are taking the fight to the middle market, where banks are ploughing resources into fast-growing companies in the hope of locking down relationships with the blue-chips of the future. At the same time, the boards of FTSE100 companies are changing and the next generation of chief executives and finance directors are reviewing their rosters of advisers. Since January 2010, around one third of the FTSE100 have changed their brokers and more changes are expected in the coming months.Sticky relationships
Every UK listed company deploys the services of a corporate broker, whose job is to act as an interface between the company and its shareholders. The company pays an annual retainer but the broker will earn fees when the company looks to raise equity. It is characterised by a stable hierarchy, which serves both to frustrate and encourage new entrants in equal measure, "Corporate broking relationships are probably the stickiest of any and that is what makes the business so attractive to new and established players alike," says Nick Donald, head of UK equity capital markets at HSBC. It is this stickiness that impressed the management of Bank of America during the tumultuous months that followed its acquisition of Merrill Lynch. As the writedowns continued and Bank of America battled to keep Merrill's London-based investment banking operation together, they noticed that one small area of the bank was enjoying a bumper year. Merrill was a top three corporate broker by number of FTSE 100 brokerships and was therefore omnipresent on the record number of equity issuance by blue-chip corporates during 2009. "Management — and our rivals — saw how important those broking clients were," says one managing director. "When business everywhere was as bad as it was, everyone was scrambling to get on these deals and we were at the centre of them because of our business." The power that a corporate broker can wield was not lost on Barclays Capital, which began building a corporate broking business from scratch in 2009. Its aim is to break into the top three by number of FTSE 100 brokerships and since the formal launch of its operation in 2010 it has won seven blue-chip clients. "New entrants in corporate broking have forced incumbent providers to raise their game," says one head of corporate broking. "Once you have built the business, there are no new approaches to corporate broking — it's about providing a consistently excellent service to clients and ensuring you have the best people to do it." Personality central
Personal relationships are central to corporate broking and that is why a new market entrant can build share — and damage a rival's business in a short space of time. While banks tend to institutionalise their most important corporate relationships, company chief executives and finance directors forge personal relationships with their corporate brokers and in many cases will switch relationships when the favoured broker switches firms. Brokers say the last time the sector was in a similar state of flux was 2005 when Morgan Stanley entered the market in dramatic fashion, poaching a four-strong team from Merrill Lynch that triggered a broader recruitment merry-go-round. Merrill hired brokers from Hoare Govett. which was then plundered by another integrated firm, Citigroup, when it took a seven-strong team as it beefed up in corporate broking. This time, it is Barclays Capital making the recruitment waves, hiring Jim Renwick from UBS and Alisdair Gayne from Morgan Stanley but unlike 2005, there has been little in the way of retaliatory recruitment. At the same time. JP Morgan forged a joint venture with the UK's leading broker Cazenove precisely because it saw the potential of a client list that included almost half of the UK's biggest companies. During that period, corporate broking moved from a parochial pursuit and into the mainstream of investment banking, but not always with the best results. "Many banks have turned corporate broking into a UK coverage business, which can mean that clients do not get the best equity market advice," says Gayne, who is now head of corporate broking at Barclays. The successful broking business will combine personal relationships with institutional coverage. For broking to work, it must be a business in itself, rather than a Trojan horse through which to push other products, Gayne says: "Broking is central to the institutional relationship. Typically our broking clients have an existing relationship in another area of the bank." Consequendy, some banks saw broking as the ultimate tool for cross-selling to UK PLC and got themselves tangled in conflicts. "There were a number of companies which came out of the credit crisis and found that their brokers had not always been there," says Nick Bowers, co-head of UK corporate broking at Deutsche Bank. "Investing in the business is crucial to ensure the same level of service across all clients." Integrated relationships
Building a broking operation requires investment and patience, with brokers measuring success in years rather than months, but a bank's management and shareholders often want a quicker return. Regardless of the rhetoric that banks employ — they are building an institutional relationship rather than cross-selling — the end result is often the same. The aim of being a corporate broker is to cement a relationship that will lead to ancillary business. Last year, Barclays Capital was broker, financier and adviser to Resolution on its acquisition of the UK life business of French insurer Axa. "Since the crisis, some companies have wanted a more integrated relationship with their banks and they would expect to develop a broader relationship with their broker," says Bowers. "Our broking operation is a discrete business but it is part of our integrated coverage effort. "While companies want specialist advice on what moves their share price, they are also looking for balance sheet support." Chief executives remember the support they received during and after the credit crisis — going forward they want to know they have the right group of banks to advise them," Bowers adds. Tweaking the model
The crisis has had a particular effect on corporate broking because it has forced banks to look at their client lists and prioritise the most lucrative ones, or those that have the most potential to grow. Newcomers have targeted clients that they perceive are being neglected, or where they see a shift in emphasis. The full acquisition last year of Cazenove by JP Morgan could prove a catalyst for those banks that have laboured for years to dislodge the UK's leading broker. "All of those brokerships are institutional relationships held by Cazenove," says one rival. "JP Morgan is developing a corporate banking presence through building its lending relationships so some of those clients could be up for grabs." Both the mood music and regulatory landscape in banking have changed since the crisis and corporate broking has been a beneficiary because it is a client business that does not consume capital or require a firm to take a position. "However, winning corporate broking beauty parades is one thing, but getting to 20 or more brokerships requires consistent investment and a breadth of coverage that not every firm can commit to," says Bowers. For a start, having a fully-fledged equity sales, trading and research division is regarded as a vital component for a firm seeking to establish a leading position in corporate broking.Alternative approach
However, there are some firms that are taking a niche approach to the business by seeking to focus on an area of the market where they have expertise. For example, as part of its expansion in European investment banking RBC Capital Markets has launched a corporate broking operation that will serve its big roster of clients in the metals and mining sectors. This is an alternative approach to the pursuit of as many corporate brokerships as possible. HSBC is taking a different tack that plays to its strategy of being financing focused. "We offer broking and strategic equity advisory services as part of our equity financing proposition to our global banking clients," says Donald. This is a similar strategy deployed by Royal Bank of Scotand, which has a deep lending relationship with UK PLC and has been adding broking since its acquisition of Hoare Govett, which came with its purchase of ABN Amro in 2007. Firms such as Credit Suisse and Goldman Sachs, which have established broking businesses, take a similar franchise view in that they offer an integrated investment banking service that includes broking to their most important clients. In a similar way Morgan Stanley, a leading M&A adviser, seeks to broaden the relationship with its existing advisory clients. "While there is no guarantee that a brokership will lead to an M&A mandate, the broker is in the flow and is arguably best placed to provide defence advice in the event of an unsolicited bid," says Bowers. The glut of rights issues in 2009 led to tensions between rivals as corporate brokers complained that their clients were being pressured into giving lending banks a seat at the table in equity capital raisings. This aggressive approach may have given some banks visibility in broking, but it does not make for a profitable business. "Being a company's broker means you are the co-ordinator on any rights issue," says one ECM banker, "Forcing your way on to the ticket as a co-manager earns you a fraction of the fee and does not constitute a proper broking presence." Big corporates are divided over whether they want a broker to offer other services. Some want to do business with a smaller number of banks and run integrated broking pitches on the understanding that the winning bank will be a lender, adviser and broker. Others prefer a more arms-length approach. For example, in 2009. Vodafone replaced UBS and Goldman Sachs with Citigroup and JP Morgan as its long-standing corporate brokers. Since then, both Goldman and UBS have continued as the company's M&A advisers. Meanwhile, oil giant BP prefers to use advisers only when it has to. M&A shake-up
The next M&A cycle will decide the winners and losers of the latest shakeup in corporate broking. While being a retained broker more or less guarantees equity business, it does not follow that other business is up for grabs, a point that banks must heed as the M&A recovery kicks in. "Over the last few years, investment banking activity has been very focused around refinancing," says one. "Now that corporate balance sheets have largely been repaired, I would expect M&A to become an increasing focus for corporates." This goes to the heart of the economics of corporate broking. When deciding on their strategy in corporate broking, banks must ensure their interests are aligned with those of their clients. So if they want a client's M&A business, they should focus on those companies that are open to having an integrated relationship or where they think they have an angle. While corporate broking relationships are long term and involve strategic dialogue with the company's board, they do not guarantee a seat at the table when the board presses ahead with an M&A deal. Equally, if being a broker to one company prevents them from advising a rival in the same sector, they could be shutting off another potentially better revenue stream. Mid-market strategy
Instead, banks are tempering their reliance on the biggest companies by building out a mid-market broking presence. "We believe that a balanced approach is the way to build a sustainable broking business," says Gayne. "Fifty percent of our broking clients lie outside the FTSE100 and that is a ratio we would be happy with going forward." There is a push underway at big banks to capture mid-market broking mandates and many have a dedicated mid-cap broking initiative underway. "The benefit of serving the mid-market is that you are identifying fast-growing companies that have the potential to grow by acquisition and are likely to require access to the equity and debt capital markets," says HSBC's Donald. This is particularly true in the oil and gas sector, where banks have reaped rewards of nurturing companies in their early days. Bank of America Merrill Lynch started acting as broker to Cairn Energy when it was a £7m company — it is now a FTSE100 heavyweight with a market capitalisation of £5.8bn and recently sold its Indian subsidiary to Vedanta. The bank has recently started acting as broker to PetroCeltic and Bowleven. The scrap for mid-market supremacy is almost a fierce as the battle being played out in the FTSE100 and in many ways it is more important. Trophy bluechip brokerships bring prestige, but they may no longer pay the big fees and as sophisticated users of investment banking services, might rotate advisers or use in-house M&A teams on deals. By contrast, mid-caps are the revenue generators of the future. Deutsche has 20 mid-cap clients below the FTSE100 and is looking to double that number in the next year, while JP Morgan Cazenove, Bank of America Merrill Lynch and UBS boast dozens of non-blue-chip names between them. At the same time dedicated mid-cap brokers like Numis, Collins Stewart and Investec are beefing up their presence, and broadening their corporate finance offering to include advisory and lending. Since the jumbo rights issues of 2009, corporate brokers have had little to shout about in terms of business. Pitching and winning new brokerships is one thing, but banks will hope that when the next round of upheaval is over, they will have picked the right horse. Simply amassing blue-chip brokerships as a glorified marketing exercise is not an option. "Banks must take a long term view of broking because the model does get questioned if revenues do not come quickly," says Bowers.
Will Wallis has won the Small / Mid Cap award at the Sammons Associates 13th Annual Heads of Research Awards 2011. Charlie Mills of Credit-Suisse won the award for the best Head of Research in Large Cap. Jon Moulton of Better Capital presented the awards.
The results are drawn from a survey base of Chief Investment Officers, Portfolio/Fund Managers and Analysts from the 1,250 largest investing institutional managers based in the UK, Ireland and Europe.
In the UK Small & Midcap Survey, there were two overall categories:
From Company votes, Numis was ranked No.1, ahead of Investec (No.2) and JP Morgan Cazenove (No.3),
From Fund Manager votes, Numis came No.3, after Investec (No.1) and Peel Hunt (No.2)
In the Pan-European Survey, Numis came 6th overall for UK – Leading Brokerage Firm.
Looked at by research sector within the UK Small & Midcap Survey, Numis was voted Top 3 in 7 sectors, up from 5 last year:
Construction: No.2 (FMs), Financials: No.1 (Companies), No.1 (FMs), Insurance: No.3 (FMs), Leisure: No.1 (Companies), No.2 (FMs), Media: No.1 (Companies), No.2 (FMs), Support Services: No.1 (Companies), Technology: No.1 (Companies), No.1 (FMs),
JP MORGAN Cazenove has maintained its place at the top of the City's broker advisory tables despite losing five clients since last quarter, according to the latest figures from financial data firm Hemscott.
The company now has 239 clients still a fair way off its peak of 251 in early 2010 but streets ahead of closest rival Numis, which has 127.
JP Morgan Cazenove is also still leading the way in advising the UK's blue chip companies, with 37 clients listed in the FTSE 100.
The ranking of the big four auditors remained unchanged from the previous quarter, with KPMG retaining the top spot with 376 clients, ahead of PricewaterhouseCoopers' 317.
But the gap between the top two narrowed slightly, with KPMG losing seven clients in the quarter to 6 May, while PwC added one.
PwC also continued its dominance of the FTSE 100, representing 38 clients compared to joint-second place PwC and Deloitte's 22 each.
BDO is still the only non-big four accountancy firm to represent a FTSE 100 client.
JP Morgan Cazenove also kept its financial adviser's crown, retaining 104 listed clients to stay well ahead of second-place Seymour Pierce.
FinnCap jumped into the top ten adviser rankings, climbing to ninth place from eleventh after adding three clients during the quarter.
The top three financial PR rankings also remained unchanged, with Financial Dynamics, Buchanan Communications and Pelham Bell Pottinger leading the board.
THE first private company to take over a failing NHS hospital is to float on AIM. Circle Holdings, which is close to being handed a contract to run Hinchingbrooke hospital in Cambridgeshire, is expected to list its shares next month and could be valued at about £100m. Circle Holdings' main asset is its 50.1% stake in Circle Health. The remaining 49.9% is owned by 2,500 staff. They will continue to own their shares after the float. The group, dubbed "the John Lewis of the hospital world" because of its employee-ownership structure, was founded in 2004 by Ali Parsa, a former Goldman Sachs banker who arrived in Britain aged 16 as a refugee from Iran.Circle operates five hospitals, including a £50m flagship in Bath that was designed by Norman Foster and opened last year. The group also runs facilities in Nottingham, Windsor, Stratford-upon-Avon and Burton-on-Trent. Circle is set to take on a 10-year contract to run Hinchingbrooke. Under the deal, the hospital buildings will remain in state ownership and its staff employed by the NHS. Last year, Circle secured £50m to fund its second newbuild hospital. This is due to open in Reading in autumn 2012.The planned float will provide an exit for Circle's institutional shareholders, which include Balderton, the venture capital firm, and the hedge funds Odey and Lansdowne Partners. It is not yet clear how much money the hospital group plans to raise from the listing. Numis has been appointed as broker and adviser to the company. Circle's non-executives include Tim Bunting, a Balderton executive. Also on the board are Lorraine Baldry, the former Prudential executive. The company declined to comment on the planned float.
No one would pretend that corporate broking and investment banking to smaller and medium-sized quoted companies has been easy in recent years.
Yes, there was that brief spurt of rights issues and placings at the end of 2009 and early 2010 as those corporates who could took the chance to strengthen their balance sheets after the banking crisis.
Since then, there have been almost as many pulled initial public offerings as those that went ahead. Takeovers have been few and far between. And those that have happened tend to have been agreed without the fat fees earned in hostile bids.
But on top of this firms such as Numis have been hit by something of which, I must admit, I was unaware - the rise in VAT. Like everyone, I knew that retailers, particularly those selling big-ticket items, would be clobbered by January's rise in VAT from 17.5% to 20%. But the idea that brokers might be hit had not crossed my radar.
Numis chief executive
Oliver Hemsley, pictured, explained it to me this week. Almost all the services that a firm like his offers, from the commission it earns on stockbroking trades to the fees it charges for flotations like Betfair's, or rights issues, are VAT exempt.
But all the services which Numis uses - from its property costs through its trading system Fidessa and settlement via GL Settle - charge VAT.
Because very few of Numis' own services collect VAT, it is unable to offset the bulk it is charged. In most service businesses, the one offsets the other much of the time.
In Numis' case, this means a £200,000 hike in its first-half VAT bill and the likelihood that the full-year bill will be pushing towards £2 million. That is a significant amount for a company that made pre-tax profits of £4 million in the first six months.
There must be a case for a Government that is trying to encourage the City in its help for smaller businesses to look at some way in which firms like Numis could receive some kind of VAT exemption on the services they have to employ to perform their role
Numis chief executive Oliver Hemsley hopes for a stronger second-half this year Numis eyes rosy future as first half profits slide.
Numis revealed a slide in profits over the six months to 31 March, but said it remained bullish for the year ahead. Pre-tax profits fell to £4.1m from £9.4m a year earlier. Revenues fell to £26.5m from £31.3m. However, profits and revenues were up on the figures Numis posted for the second-half of last year. The stock market listing of Betfair was amongst a handful of high-profile deals handled by the broker in its first-half.
"It's definitely a turnaround on where we were for the final half of last year," chief executive Oliver Hemsley told City AM. "We've invested in attracting some really good quality clients and people and hopefully that will come through in our numbers in due course."
NUMIS, the niche investment bank and broking firm, has turned the corner after a very subdued middle of 2010.
Thanks to some high-profile deals such as the Betfair flotation and Brit Insurance's takeover, profits for the six months to end-March were £4.1 million. That is down on a year ago's £9.4 million but much better than the second half of last year's £1.6 million loss. The current pipeline of deals is strong.
Profits at Numis, the stockbroker and small investment bank, for the six months to March 31 fell from £6.1 million last year to only £1,000, although it lost £6 million in the second half of 2010. The shares rose 6.7 per cent to 112p.
Stockbroker Numis rose 7p to 112p after an upbeat statement about second-half prospects outweighed news of a fall in first-half profits. Chief executive Oliver Hemsley said the firm has made a good start to the second-half of the year, with seven deals announced in April and a strong pipeline of other corporate transactions.
Shares in Numis rose almost 7 per cent as the stockbroker reassured investors on its second half prospects in spite of a drop in first-half profits.
Shares in stockbroker Numis rose almost 7 per cent as the company reassured investors about its prospects for the second half of the year, despite a steep drop in first-half profits.
“It has been very difficult time for the broking sector since 2008. But the market is definitely in a recovery,” said Oliver Hemsley, chief executive.
"We are encouraged by aspects of our first-half performance and, coupled with five further fundraises announced in April, are confident that the investment we have made in our people and our clients puts us in a strong position,” he added.
However, Mr Hemsley pointed to “uncertainty in economic and market conditions” as the company reported an 18 per cent drop in revenues for the six months to March to £26.5m. Pre-tax profits, which were £6.1m in the same period a year earlier, dropped to just £1,000 while the company reported a loss per share of 0.8p. Nevertheless, the interim dividend was held at 4p.
Mr Hemsley, who owns a 12 per cent stake in Numis, said the drop in profits was a result of rights issues at the start of last year, boosting the company’s revenues at the time.
Staff costs fell from £18.6m to £16.4m while total headcount remained unchanged from September 2010.
The company won 17 new corporate broking clients during the period, bringing the total to 138. Numis worked on the initial public offerings of Betfair, the UK-based online betting exchange and CatCo, the reinsurance opportunities investment trust.
Simon Denyer, the finance director, said he was confident in Numis’ ability to return to 2007 transaction levels. Last year Numis did 25 transactions, raising £1.3bn
“We need about 40 transactions a year to be back where we were. We have retained our client base so I can see us getting back to these levels in the next two and a half years. Mergers and acquisitions, IPOs and fundraising activity are all set to pick up this year if the market continues to remain stable,” Mr Denyer said.
Analysts said that rather than the quantity of transactions, Numis needs to try to raise the average value of each deal
The company used its interim results statement to update investors on an £61m legal claim by Fidelity, CQS and two smaller investors, over the level of disclosure in a fundraising deal for Rock Well Petroleum. Numis said that “the allegations are entirely spurious and unfounded”. The company added that it would continue to defend the claim vigorously, saying that “there is no provision in the financial information for future costs associated with or emanating from this claim”.
Numis shares closed up 7p at 112p.
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Numis Corp. reported a fiscal first- half profit of 4.88 million pounds compared with a loss in the year earlier period.
Stockbroker Numis Corp. PLC (NUM.LN) Wednesday said it swung back to profit for its fiscal first-half, following a rebound in equity markets and an increase in corporate activity.
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INVESTMENT bank Numis saw underlying pre-tax profits halve to £4.2m in the year to September 30.
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