Equiniti chairman admits 2020 was a ‘difficult year for shareholders’ as profits tumble
The chairman of Equiniti has admitted 2020 was a tough year, with the business recording reduced revenue, EBITDA and profit.
Revenue at the payments and technology firm was down 15 per cent in 2020 to £471.8m, and underlying EBITDA tumbled 32.6 per cent to £91.7m.
Equiniti made a loss of £6.6m in profit before tax, down from a profit of nearly £40m in 2020.
Chairman Philip Yea said 2020 had proved “a difficult year for EQ shareholders.”
“The disruption to capital markets and the wider economy has had an unprecedented and widespread impact on our markets. Quite understandably, corporate clients have been deferring projects, reducing or cancelling the level of their dividends and in the UK those fundraisings which they have undertaken have in many cases been structured directly through placings rather than the more usual rights issue,” said Yea.
“Actions taken by the authorities, such as the reduction in central bank interest rates and the temporary disapplication of pre-emption rights for certain share issues, were understandable from an economic and regulatory standpoint but have had a marked effect on our revenue. While our recurring business has proved resilient, around half of the discretionary and market-paid element of our revenues has been adversely impacted.”
Following this morning’s results Equiniti’s share price fell 5.6 per cent soon after markets opened.
The business again decided it would not be offering a final dividend for 2020, having not offered a dividend at the end of 2019, nor in 2020 with its half year results.