Investments  

Miton assets surge 73% on PSigma deal, organic growth

Reading-based fund house Miton Group has reported assets under management growth to £3.1bn following its acquisition of PSigma Asset Management.

The group has booked a 73.5 per cent asset rise, from £1.8bn at the end of 2012, in final results for the year ended December 31 2013, published this morning.

The asset gain included £749m from the PSigma deal, which saw Miton take over the income funds run by respected manager Bill Mott, and £351m of organic growth on Miton’s existing funds.

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The group also said the previously announced sale of its Liverpool office was set to complete on March 31 2014.

Managing director Gervais Williams described the corporate changes as “amazingly exciting”, saying the group was now focused on organic growth.

“We’ve got so much opportunity in the core business,” he said.

Net revenues at the group rose by 29.3 per cent to £15m in 2013, although pre-tax profits fell by 22.2 per cent from £900,000 in 2012 to £700,000 last year.

The group cited £1m of exceptional costs relating to the PSigma transaction as having weighed on profits.

Miton’s cash generation from operations rose by 52.8 per cent to £5.5m last year, and its total cash balance fell by just 6.7 per cent to £11.2m in spite of the PSigma buyout, which was previously flagged as costing roughly £13m.

The AIM-listed fund manager has proposed a bumper dividend per share of 54p, up 20 per cent on last year’s payout.

Mr Williams added that the group currently had no further deals on the table in spite of the high cash levels, pointing to the dividend increase as delivering some of this cash back to shareholders.

He said some brokers had expected the sale of the Liverpool unit to be earnings dilutionary but those fears were likely to subside following this morning’s results.

“We don’t need deals, we’ve got organic growth here,” he said.

“Having a strong balance sheet means we can take advantage of opportunities. We are quite a small group so even small deals can make a difference to us.”

He added that the departure of UK equity income star Neil Woodford from Invesco Perpetual, which has caused many investors to consider alternatives in the sector, and the recent Budget could both provide a further boost to the business.