Shore Capital’s shares soar as revenues rise

Tim Wallace
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INVESTMENT bank Shore Capital reported steady profits in the first half of 2012 yesterday, with strong growth expected to continue in part thanks to its German telecoms investments.

Group revenues came in at £17.8m, up 28.3 per cent on the second half of 2011, and down 12.7 per cent on the first half of last year.

That took pre-tax profits to £2.2m in the first six months of 2012, down from £4.3m in the same period of last year but still a solid performance given weak market conditions. Shore’s shares jumped 24.1 per cent on the announcement, hitting 18p by the end of the day.

The firm’s commission earnings increased nine per cent on the first half of last year, and executive chairman Howard Shore believes equity markets may have bottomed out, allowing for more growth in the near future.

He also believes Spectrum Investments, the group’s German telecoms asset, has the potential to make a strong capital gain for the b business.

Shore is continuing to raise £20m to £30m for its latest five-year venture capital trust, branded Puma VCT 9.

“It is not an easy market to raise money in for five years, but it is not impossible,” chairman Howard Shore told City A.M.

“Investors put their funds with us for tax breaks and because of our strong track record. It is a trade of between liquidity and return, so it is not something that sells like hot cakes – we really have to prove we are the best.”

Shore has had to move out of some less successful areas, writing off a hotel investment and closing its private wealth business in the last year.

But the firm said those are the last planned closures, with only stronger prospects remaining.