FinnCap expects to 'broadly breakeven' in H2
Investment bank Finncap said on Thursday that it expects to "broadly breakeven" in the second half of 2020 and turn a profit for the year as a whole.
Finncap stated that throughout the year, its equity capital markets division had continued to complete a variety of deals and retained a number of corporate clients. However, the firm did note that this had been somewhat offset by client churn - largely from delistings or acquisitions.
The AIM-listed group still expects the trading performance in the equity capital markets unit to be in line with that recorded in the first half of the financial year.
In its mergers and acquisitions division, Finncap highlighted that at the time of its interim report card, its outturn was reliant on a number of higher value transactions.
However, since then the timetable for those deals had "lengthened" and Finncap now expects its trading performance in the unit to be "below that seen in the first half".
Finncap also said it had recently reduced its operating expenses to ensure that fixed costs in 2021 would be "broadly the same" as 2020.
"The combination of the reduction in costs, the expectation that the M&A division will benefit from closing the larger deals delayed from the second half of the current financial year, and a continuing return to more normal market conditions in the equity capital market division, means that the board expects the group's trading performance in the first quarter of FY21 will show an improvement on its performance in the second half of the current financial year," said Finncap.
As of 1330 GMT, Finncap shares were down 2.13% at 23p.