SHORE Capital slipped into the red last year after losing more than £6m on its investments in hotels and telecommunications firms.
The small broker and independent investment group posted a statutory annual loss of £875,000, compared to a profit of £8.37m in 2010.
It lost £4.8m on Puma Hotels, which owns 20 hotels around Britain, and £1.3m on Spectrum Investments, the vehicle used to hold its 29 per cent stake in German telecoms firm DBD.
Shore executive chairman Howard Shore said last year had been “one of the most challenging” for the industry since he set up the firm in 1985.
“Activity levels so far in 2012 have picked up well from the quieter months of last year’s second half but are still behind the comparable period last year,” he added.
Both large and small investment banks have been hit by the market slump. Shore’s pre-tax profit from operating business nearly halved to £5.4m although the equity capital market business performed well and Howard Shore told City A.M. that work picked up at the start of this year.
“There has been a reduction in risk aversion from the extreme conditions of last year. If you have the right offering with the right audience with the right price you should get it away.”
Shore also said the year-end break and the European Central Bank support for the region’s banks had helped to improve sentiment and market conditions.