Numis back on form after rally spurs revenues

Michael Bow
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CITY broker Numis put the financial downturn behind it yesterday after posting a thumping increase in full year revenues and profits.

The firm, which helped bring seven companies to the stock market over the year, said revenues rose 55 per cent to £77.7m and adjusted pre-tax profits increased to £25m – close to a three-fold increase on the £7.7m it posted last year.

“The market has picked up a lot over the past year and institutional flows have been fantastic – we’ve had a good run of IPOs,” chief executive Oliver Hemsley told City A.M.

“This firm benefits from operational gearing, so when things go well we see a big increase.”

Numis slowed between September 2011 and September 2012 with revenues and profits falling due to what it dubbed an “over-broked market”. This year it added 28 new clients and prospered from an overall increase in market volumes, with secondary trading in main market stocks up 8.6 per cent.

“There’ll always be slips and crashes and we had a proper downturn between 2008 and 2011 but now we’re in recovery. I’m bullish for the year ahead,” Hemsley added.

The company has a huge range of clients for its broking business, from 62 small businesses on the junior stock market to 31 bigger FTSE 250 clients. Hemsley said the firm was currently on the lookout to hire more people across the business.

Thanks to the increase in market activity, combined institutional commission and trading revenues increased 50 per cent over the period. Income from corporate and issuance transactions increased by 75 per cent.

The company also upped its dividend by 1p and more than doubled its cash pile to more than £70m.