‘Challenging’ was the word used by Cenkos Securities PLC (AIM:CNKS) chief executive Julian Morse to describe conditions in the first half of 2022 with the cost of living crisis, a stagnant economy and the conflict in Ukraine all adding to the choppiness in capital markets.
The institutional stockbroking firm said its revenues fell to £12.7mln for the six months to June 30,2022, down from £18.2mln previously which was a high water mark for activity. Underlying profits, meanwhile, fell by £1mln to £1.9mln.
Against a tough backdrop, the group, whose main line of business is corporate finance for smaller listed companies, accounted for 23% of all money raised on the junior market AIM.
Cenkos said it had completed three transactions in the second half to date. However, it deployed the ‘c-word’ again, describing the outlook as ‘challenging’, adding that it was likely to remain so for the ‘foreseeable future’.
“More than ever, we see that stability and operational resilience will be critical qualities over the near term,” CEO Morse said in the results statement.
“We continue to operate with a very strong balance sheet, holding additional capital above regulatory minimums, and our variable remuneration structure allows us to maintain a disciplined approach to staff costs.
“We believe this provides us a flexible, resilient platform to deliver from as opportunities present themselves.," he added.
The company exited the period with net assets of £23.7mln and net cash of £15.9mln, down from £24mln at the end of June 2021.
Unsurprisingly, the dividend has been shaved down to 1.00p from 1.25p, but, as Cenkos pointed out, it has returned £118.6mln, or the equivalent of 185p a share, since its float in 2006.