FinnCap said revenues had plunged 48 per cent in the first half of the year as a slump in capital markets activity hammers profits for the City’s brokers and investment banks.
In its half-year results this morning, the London-listed financial services group said it had swung to a £2.59m loss in the first six months, down from a £6.28m profit in the same period last year.
Wild gyrations on the markets and recessionary fears have caused a slump in initial public offerings and deals in London, and have caused profits to dry up for a string of investment banks and brokerages.
Finncap said it had raised £80m of equity for its clients in the first half of the year, down from £250m last year, while the value of private M&A transactions tumbled from £1bn last year to £430m this year.
Boss John Farrugia said the results showed the “resilience” of the firm however, with its “broader-based financial advisory” preventing a sharper downturn.
“We have delivered a good (first half) private and public M&A performance helping to offset the well publicised weakness in the equity issuance market which is affecting all of our competitors,” he said.
“Despite the challenging macro environment, our H1 results were in line with our expectations and the Group continued to deliver for clients executing 31 transactions with an aggregate value of c.£700m.”
Farrugia added that the firm would pause its interim dividend for the first half due to the uncertainty in the market conditions.
“A final dividend for FY23 once we have completed the year and have greater clarity on the outlook for the business and our industry in 2023,” he added.