Investment group Shore Capital (SGR:AIM) is the best performing UK-listed broker over the last five years as its shares have soared more than ten-fold from 22p to 256p.
This is a significantly better share price performance than rivals Numis (NUM:AIM) and Cenkos (CNKS:AIM).
Over the same period, shares in Numis have more than doubled from 149p to 360.5p and Cenkos enjoyed a 39.1% rally to 112p.
Shares in Shore Capital are up 4.5% after adjusted pre-tax profit jumped 27.5% to 6.5p and its total dividend rose from 5p to 10p in the year to 31 December 2017.
In Asset Management, sales grew 24% to £12.9m and delivered a significant uplift in profitability.
This performance was not replicated in the Capital Markets division as sales fell 3.9% to £27.2m.
Shore Capital says a ‘different business mix’ and more corporate transaction appointments being conducted on a joint basis instead of a sole one impacted trading.
It flags UK political uncertainty and costs of implementing regulatory change following the introduction of MiFID II at the beginning of 2018 as other headwinds.
MiFID II builds on previous legislation to improve the transparency of assets classes, such as equities and exchange-traded funds.
‘Consequently pre-tax profitwas £5.2m at a margin of 19.1% compared to a prior year of £6.8m at a margin of 24%,’ says Shore Capital.
The company remains optimistic, highlighting opportunities to grow Asset Management platforms and its Capital Markets division. The latter is expected to be supported by strong uptake of research from institutional clients.
