Close Brothers Group PLC (LON:CBG) reported a 47% plunge in annual profits but still proposed a final dividend after withholding its interim payout.
A final and total dividend for the year of 40p was proposed, down 39% compared to last year’s, which the board said reflects its “confidence in the group's business model and strong financial position, notwithstanding the current uncertain environment”.
The FTSE 250 group remained profitable in all its divisions for the year to July 31, 2020, though banking operating profits fell 61% to £99.2mln, asset management was down 6% to £20.4mln and at market maker Winterflood rose 140% to £47.9mln.
A £183.7mln impairment contributed to operating profit before tax falling to £140.9mln from £264.7mln a year earlier.
Profits were better than the City analyst consensus of £136mln and the dividend was bigger than then 8.3p that had been forecast.
The balance sheet remained strong, with the core tier 1 capital ratio ending the year at 14.1%, up 110 basis points year-on-year and versus the group’s minimum regulatory requirement of 8.0%.
Chief executive Adrian Sainsbury said: “The impact of COVID-19 has been felt across our businesses and the outlook is still uncertain, but the fundamental strengths of Close Brothers remain unchanged.”
He said the banking division is focused on “maintaining our prudent and disciplined approach while continuing to support our customers through this challenging environment”, while asset management “continues to have long-term growth potential and we remain committed to growing our client base organically, and through selective hiring and in-fill acquisitions”.
Winterflood has “shown good momentum through August and September but remains sensitive to changes in the market environment”.
The shares were up 3% in early trading on Tuesday to 990p, where they are down around 40% since the start of the year.