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St James’s boosts its annual dividend

WEALTH manager St James’s Place beat analyst forecasts to deliver a 12 per cent increase in full-year operating profits yesterday, buoyed by rising markets in 2009.

The Cirencester-based company, which is 60 per cent owned by Lloyds Banking Group, produced £228.9m compared with £204.3m a year earlier. Its pre-tax number swung from a loss of £115.9m in 2008 to a profit of £363.2m.

Investors were rewarded with a four per cent hike to St James’s Place’s final dividend, which brought the total dividend for the year 2.5 per cent higher at 4.5p.

Funds under management floated up 21 per cent to £21.4bn as equities rallied between March and November, but net inflows accounted for just £2.3bn.

Chief executive David Bellamy said 2009 would be viewed as “one of our most robust performances”. He told City A.M. the new 50 per cent top tax band coming in this year would ensure a flow of customers, adding: “We are getting to taxation levels where people start to worry about how efficiently their money is being used.”

Noble analyst Rakshit Ranjan was pleased with the performance, keeping the stock at a “buy” rating.

However, shares in St James’s Place fell 1.9 per cent to close at 254.7p. Concern at the 41 per cent drop in net earnings to £39.8m and uncertainty over the firm’s ownership by Lloyds’ hung over the share price, Panmure Gordon said.