Frenkel Topping tumbles as trading softens
UK-based financial advisor and asset manager Frenkel Topping said it had made "good progress" on its strategic objectives outlined earlier in the year, despite having to face a softer than anticipated trading background.
Financial Services
14,051.23
16:59 26/04/24
Frenkel Topping Group
53.50p
16:49 26/04/24
FTSE AIM All-Share
755.28
17:14 26/04/24
While posting its annual results back in April, FT set out a strategy to drive shareholder value over the next "three-to-five years" with 2018 being a "year of investment".
FT stated it had made "good progress" on its strategic objectives, albeit against a softer trading background than anticipated, largely due to amounts paid out in personal injury and clinical negligence cases rising to more than £600,000.
The firm noted that the increase in case sizes had led to a longer sales cycle and an alteration of its fee structures where, in many cases, there were smaller upfront payments to Frenkel Topping on appointment.
Despite these alterations, FT believes it has outperformed "most of its direct peers" with its continued wins and steady stream of new mandates.
However, the firm noted that these positives had been "slightly offset" by the loss of certain clients after several key consultants left the business.
Frenkel's assets under management came to £760m as of 30 June, while assets on a discretionary mandate were £313m.
FT's expert witness revenue moved ahead of last year, something the firm considered to be a "key barometer" to gathering increased AuM in future years.
In the first half, FT expects overall revenues to be approximately £3.6m, with recurring revenues of £2.9m, both in-line with last year on an ongoing basis.
Paul Richardson, executive chairman, said: "Whilst trading conditions have been tougher than anticipated in the first half of the year; the company continues to operate with healthy margins and cash flow with continued AuM growth."
"The investments made in the company and its staff will accelerate the growth profile of the business; both in terms of the core proposition and diversification into adjacent, highly relevant markets. We expect the second half to be significantly stronger and I look forward to updating further on the company's progress at time of publication of half-year results," added Richardson.
At 1115 BST, FT shares had dropped 18.8% to 38p.