Wealth manager Mattioli Woods plc (LON:MTW) maintained its profit outlook for the year even as first-half revenue missed expectations due to lower client fees and tough market conditions.
The group said revenue in the six months ended November 30 amounted to £29.9mln, up 2.8% on a year ago but “slightly lower than expected” following a contraction in client activity on the back of poor investment sentiment and Brexit uncertainty.
READ: Mattioli Woods reports lower-than-expected revenue as Brexit hits investment confidence
Pre-tax profit gained 3.7% to £5.6mln while adjusted pre-tax profit increased 8.3% to £6.5mln.
Total client assets under management, administration and advice edged up 0.7% to £8.79bn.
The results included a positive contribution from the Broughtons Financial Planning business acquired last August.
The group also generated an increased share of profit from Amati Global Investors, which saw total funds under management rise to £337.3mln at November 30 from £313.0mln on May 31.
Last month Mattioli Woods scrapped a plan to take full ownership of Amati and decided to remain a minority shareholder with the 49% stake it purchased in February 2017.
Brexit uncertainty continues to impact markets
“While there remains uncertainty around Brexit it will continue to impact markets and consumer confidence,” said chief executive Ian Mattioli.
“Our integrated model means we are well-positioned to proactively advise our clients and we anticipate we may see an increased demand for advice once the shape of Brexit becomes clearer.”
He said the majority of the group's revenues are fee-based, rather than linked to the value of assets under management, administration and advice, meaning the business is less sensitive to market performance.
Full year guidance unchanged
Mattioli added: “Although there is some caution around markets, we believe the group is well placed to secure further growth, both organically and by acquisition, and further consolidation within our core markets remains likely.
“We continue to manage our clients' assets and the group's cost base with care. Our profit outlook for the year remains in line with management's expectations and I am confident we can secure further progress towards the ambitious longer-term goals we have set."
The company raised its interim dividend by 15.1% to 6.33p each as it ended the period with net cash of £16.4mln, up from £14.8mln last year.
Shares were down 0.34% to 735p in morning trading.