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Quilter proposes inaugural final dividend after 2018 profit and revenue rises despite tough markets

The FTSE 250-listed firm posted pre-tax profit of £163mln, a turnaround from a £54mln loss the previous year, as one-off charges dropped to £70mln in 2018 down from £263mln in 2017
Growing wealth
Quilter will pay a final dividend of 3.3p per share, which analysts at UBS pointed out was around 13% higher than forecast

Quilter PLC (LON:QLT) saw its shares rise on Tuesday as the wealth management group – spun out from Old Mutual Ltd. (LON:OMU) last year - proposed an inaugural final dividend after its 2018 profit and revenue rose despite tough markets.

For the year ended 31 December 2018, the FTSE 250-listed firm posted a pre-tax profit of £163mln, a turnaround from a £54mln loss the previous year, as one-off charges dropped to £70mln in 2018 down from £263mln in 2017.

READ: Old Mutual reintroduces final dividend as costs savings lift 2018 profits despite difficult economic conditions

The firm’s 2018 adjusted pre-tax profit - excluding exceptional costs rose to £233mln, up from £209mln in 2017, as its return on equity widened to 12.9% from 12.7%. The profit increase came as Quilter’s total fee revenue rose by 8.3% to £788mln, up from £728mln the year before.

However, the company’s net client cash flow fell to £4.7bn, down from £7.6bn, while assets under management declined to £109.3bn from £114.4bn.

The group‘s chief executive officer Paul Feeney commented: "Quilter performed well in 2018 despite increasingly challenging market conditions as the year progressed.”

However, Feeney added: "Brexit and market uncertainty continue to temper momentum in year-to-date flows and therefore we remain cautious on net flows going into 2019."

Divi above expectations

The company said it will pay a final dividend of 3.3p per share, which analysts at UBS pointed out was around 13% higher than their and consensus expectations.

UBS reiterated a ‘buy’ rating and 170p price target on Quilter shares which in mid-morning trading were 4.8% higher at 138.40p.

On Monday, Old Mutual Ltd (LON:OMU) reintroduced a final dividend as costs savings helped the South Africa-based firm's 2018 profits rise, offsetting weak trading in difficult economic conditions.

In 2018, the former blue-chip company was broken up into four separate entities - Old Mutual Wealth (OMW), Old Mutual Emerging Markets (OMEM), South African lender Nedbank and US firm Old Mutual Asset Management (OMAM).

As part of the plan, the group spun off the wealth arm – which was renamed Quilter - and created Old Mutual Limited as a holding company which included OMEM, Nedbank and the residual parts of Old Mutual PLC.

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Quilter PLC Timeline

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