UK stockbroker Charles Stanley has warned that low transaction volumes and rising costs will cause its results to be “materially below” market expectations unless there is a significant improvement soon, reports FTAdviser sister title FastFT.
The investment house last reported its results on June 30, when the falling commission income caused by low volumes, and costs related to upgrading its direct-to-clients offering, had put pressure on its margins.
Today Charles Stanley said: “This trading pattern has continued through July and August. Whilst management have taken actions to reduce the cost base and boost income the Board now expects that, barring a significant improvement in the markets, trading results will be materially below current market expectations.”
The full results for the half year to September 2014 will be out in mid-November. At least Charles Stanley’s fee income from its asset management business is picking up, thanks to an increase in its total client funds to £20.5bn at the end of August, up 1.9 per cent from end-March.
“The board remains particularly encouraged by the rate of progress of Charles Stanley Direct which has increased its assets by 18% to £0.9 billion over the same five month period to 31 August 2014.”
