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Matheson: strategic review will create a 'fitter' Brewins
by Sarah Miloudi on Dec 07, 2011 at 07:29
Private client stockbroker Brewin Dolphin hopes to boost its operating margin to over 20% - part of a three-year plan to achieve maximum returns for shareholders.
The strategy is already underway, Brewins chairman Jamie Matheson said, as he announced that the listed wealth manager's profit before tax dropped 27% over the year to end of September.
Despite a lift in total managed funds, Matheson (pictured) said that Brewins' pre-tax profit for the year came in at £21.9 million as at 30 September, compared to £30 million 12 months before.
Undoubtedly, 2011 has been a challenging year for investors, with the ongoing difficulties in Europe and slow growth prompting a number to flee equities. But Brewins said that its total managed funds for the year stood at £24 billion, compared to £23.2 billion for the year ended 26 September 2010.
The stockbroker's discretionary funds stood at £15.6 billion at the end of the period versus £14 billion in 2010.
Reassuring Brewins shareholders Matheson said that the business has made good progress throughout the year, building out its office network to include a new branch in Bristol as well as adding to its teams in Glasgow, Leeds and London.
Brewins' charity team based in London has also doubled in size, also helping to boost Brewins' funds under management, which is 2.4% higher than last year.
Despite these improvements the wealth manager's chair is keen to boost shareholder value and says the firm has started to re-engineer its processes to improve investor returns.
'It will take three years to achieve maximum benefits for shareholders, by which time we intend to have increased our operating margin to over 20%. Six months into the project we are on time and on budget,' Matheson told investors in the firm.
The chair expects Brewins' strategic initiatives, which focuses on investment management and the dual targets of reinforcing service standards for the longer term, to be introduced without increasing the firm's capital expenditure run rate.
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