Fragile capital markets and reduced appetite for fund raising saw stock broker Panmure Gordon (PMR:AIM) register a £16.7 million loss in 2015.
And conditions remain tough in 2016 according to chief executive Patric Johnson, who reels off a list of further uncertainties in full year results published today.
‘The start to 2016 has proved to be extremely challenging in all areas of the financial services industry,’ says Johnson in a full-year results statement.
‘We have seen volatility spike and a continued decline in trading volumes, all within a macro backdrop of uncertainty regarding Europe and the United Kingdom's continued participation in the EU as well as the US elections and China's economic slowdown.’
Appetite for fund raising may be a little stronger this year, Johnson indicates, highlighting Panmure’s involvement in 14 transactions to the end of March 2016 versus six in the same period last year.
Trading in the first quarter means the business is in profit year-to-date, Johnson adds.
Losses in 2015 are largely the result of goodwill charges related to an acquisition made in 2005. While write-downs of goodwill are non-cash charges, they often indicate management expectations of lower future profitability.
Excluding the goodwill write-down and other non-recurring costs, Panmure delivered a loss before tax of £4.1 million versus a £2 million profit in 2014.
Johnson was appointed on 24 February as part of a wider boardroom shake-up alongside which Qinvest, Panmure’s largest shareholder, made available a £5 million debt facility to help the business through tough trading conditions.
‘We are under no illusion as to the potency of the dangers that lie ahead of us this year and the external factors that will weigh heavily on the fund raising opportunities in our market,’ Johnson adds.
Shares in Panmure trade 1.6% lower at 60p.