Sanne Group PLC

Sanne Group lifts dividend as profits gain on record new business

Sanne expects further growth in 2019 and remains “confident in the medium and long-term prospects for the group”

Sanne said it would continue to review “various potential acquisitions"

Sanne Group PLC (LON:SNN) saw its shares rise on Friday as the group, which provides alternative asset and corporate services, reported a 12.6% rise in 2018 underlying pre-tax profit as record new business wins boosted revenue.

Underlying pre-tax profit rose to £42.6mln last year from £38.1mln in 2017, on revenue up 27.2% to £143mlln. Organic revenue at constant currency rose 12.4%.

READ: Sanne shares tumble as news chief executive to retire counters upbeat trading statement

The increase in revenue was driven by new business wins and growth in closed-ended alternatives and corporate businesses.

The company secured new business wins with annualised revenue of about £24.5mln last year.

There were also revenue contributions from last year’s acquisitions of Luxembourg Investment Solutions (LIS), an alternative investment fund management firm, and AgenSynd, a Madrid-based loan agency services business.

Sanne said it would continue to review “various potential acquisitions within a healthy pipeline of opportunities”.

The company lifted its full-year dividend by 9.5% to 13.8p.

Another strong year expected

It expects further growth in 2019, supported by good momentum in the alternatives and corporate businesses, which account for 86% of group revenue.

The company said it remains “confident in the medium and long-term prospects for the group”.

"2018 was a significant year of growth and evolution for Sanne,” said chief executive Dean Godwin, who is stepping down on May 16.  

“Our core businesses continued to perform strongly, particularly in EMEA and the US, and we are encouraged to see the momentum building in Asia-Pacific Mauritius.”

Martin Schnaier, chief executive-designate, said: "We are excited about the opportunities in our markets and are confident that the investments we have been making in our platform will further strengthen our competitive advantage and scale our business in the years ahead.

“These investments, and the strong momentum we are seeing in our business give us confidence in our prospects and ambitious growth expectations."

In a note to clients, analysts at Liberum Capital commented: “Given the recent trading update it is unsurprising that numbers are broadly in line with our and market expectations.”

They said the “Industry backdrop remains very positive, however, higher tax and IFRS is likely to result in small downgrades”.

Liberum repeated a ‘buy’ rating and 625p target price on Sanne shares, which in afternoon trading were up nearly 2% at 514p.

 -- Adds analyst comment, share price --

Quick facts: Sanne Group PLC

Price: £5.31

Market: LSE
Market Cap: £774.72 m

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