Smith & Williamson, the accountancy and investment management group, delivered continued strong growth in the year to 30 April 2014 with both the Investment Management and Banking division and Tax and Business Services division reporting solid results.
David Cobb, co-chief executive and head of Investment Management and Banking commented:
"The group's performance reflects organic growth together with increased market confidence and activity, which has been supported by a focus on careful management of our cost base and ongoing investment in the business. We are delighted that this combination has enabled a strong financial performance across the firm."
Funds under management and advice reached £15billion for the first time demonstrating growth of 5.6% over the year, double the 2.8% rise in the FTSE WMA Stock Market Balanced Index over the same period.
Kevin Stopps, co-chief executive and managing partner of Tax and Business Services explained:
“Client service is at the very centre of our business culture and we remain indebted to our clients and professional contacts. We are in a unique position for a firm of our size, with the skills to manage the financial affairs of private clients and their business interests across investment management, tax and the full range of accountancy services.”
David Cobb added: "We remain cautiously optimistic about the outlook for the UK economy. Although a more balanced recovery appears to be taking hold, significant imbalances remain. We are investing in infrastructure and staff development to further improve efficiency and client service."
With both the Investment Management and Banking and Tax and Business Services divisions reporting increases in activity, group operating profits* rose by 22% based on an increase in operating income to £199.1million.
Investment Management and Banking enjoyed growth in profits* of 21.4% following an 11% rise in operating income to £106.2m. David Cobb explained:
"We have seen an increase in demand for our services, boosted by improvements in the stock market and investor sentiment. All of our offices which provide private client investment management advice saw a growth in funds under management during the year."
Tax and Business Services saw profits* rise by 16.7% on the back of a 3% rise in operating income to £92m. Kevin Stopps, noted:
"We saw a modest but steady upturn in market conditions during 2014 with all of our year-on-year operating income growth of 3% from organic growth in our established offices. Careful management of our cost base helped to deliver a rise in gross margins to enable profits* to increase over 16%."
Kevin Stopps and David Cobb were appointed co-chief executives of Smith & Williamson in September 2013 following the planned retirement of Gareth Pearce. At the same time, Andrew Sykes became non-executive chairman.
A summary of results for the year to 30 April 2014, compared with the previous 12 months:
- 7.2% rise in group operating income to £199.1m (2013: £ 185.8m)
- 22.4% rise in adjusted operating profit to £36m (2013: £29.4m)
- 5.6% increase in funds under management and advice, reaching £15billion for the first time (2013: £14.2bn)
- 26.1% increase in adjusted earnings per share, to 53.2p which represents an all-time high (2013: 42.2p)
- Rise in group net assets to £101.5m (2013 - £82.2m)
*Adjusted operating profits
By necessity, this briefing can only provide a short overview and it is essential to seek professional advice before applying the contents of this article. No responsibility can be taken for any loss arising from action taken or refrained from on the basis of this publication. Details correct at time of writing.
For more information on our group entities, please click here
Smith & Williamson Investment Management LLP
Authorised and regulated by the Financial Conduct Authority.
The word partner is used to refer to a member of Smith & Williamson LLP.
The Financial Conduct Authority does not regulate all of the services referred to above.