CompaniesFeb 16 2023

AssetCo declares ‘assault on costs’ as it swings to £9.2mn loss

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AssetCo declares ‘assault on costs’ as it swings to £9.2mn loss
Martin Gilbert, whose firm AssetCo posted a loss in 2022 after a number of acquisitions and an associated large cost base (Charlie Bibby/Financial Times)
BySally Hickey

Martin Gilbert’s AssetCo swung to a loss last year as a result of a number of acquisitions and operating costs.

AssetCo posted a £9.2mn loss for the year to September 30 2022, according to a results statement on the stock exchange this morning (February 16).

The company saw revenue of £8mn, however administrative expenses, which included reorganisation costs, totalled £25.6mn.

Martin Gilbert, chair of AssetCo, said the firm started the year with a cost base of £32mn, which it cut to £22.5mn including a 22 per cent reduction in headcount, however this was the main driver of the overall loss.

“An aggressive assault on continuing costs is on-going and remains a key focus of the coming year,” he said.

We are now focusing on growing assets under management and on profitabilityMartin Gilbert, AssetCo

The acquisitions in 2022 included River and Mercantile in June, Revera Asset Management in August and SVM Asset Management shortly after the year end.

Revera, SVM and Saracen Fund Mangers, another company acquired by AssetCo, are now all working together as an active equity asset business.

“We are now focusing on growing assets under management and on profitability,” Gilbert said.

AssetCo’s revenue rose from £500,000 to £8mn between 2021 and 2022, with a run rate of £17mn as at September 2022.

Gilbert noted that River and Mercantile had seen its revenues impacted by market conditions, as clients reduced their equity exposure. 

The fall in asset value and inflows totalled around £2mn between the acquisition and September 2022, and this pressure on revenues continued into the new financial year.

Despite this, AssetCo will pay an interim dividend of 1.3p per share, and the company said it plans to pursue a “progressive” dividend policy if circumstances permit.

The company will continue to explore potential acquisitions in the year ahead, Gilbert said, and take advantage of opportunities that arise from the difficult trading conditions.

AssetCo was set up as a shell company and was taken over by Gilbert in 2021. It has since been used to buy stakes and acquire firms in the asset management sector, including a stake in the Parmenion platform.