Equity Trustees' Full Year Results 2011
25/08/2011
Equity Trustees Limited today confirmed its full year financial results and final dividend, which are unchanged from the unaudited results announced on 5 August, 2011.
Net profit after tax increased 2.3% to $8.2m, summarised as follows:
Equity Trustees’ Chairman, Mr Tony Killen, said that the Group was pleased to report an increase on the prior year net profit after tax despite a continuation of market volatility and challenging business conditions, especially during the June quarter.
“For the first three quarters the investment markets had shown some signs of improvement, however, in a pattern similar to that in the prior year there was a reversal during the June quarter. As a result of the continuing market uncertainty, which has now continued very markedly into the first months of the current financial year, and the use of cash for acquisitions, the EQT Board has decided to reduce the fully franked final dividend from 60 to 50 cps. Thus the dividend for the full year will be 100 cents, fully franked, reflecting a current yield of approximately 8.0% before franking credits.”
Notwithstanding the reduction in final dividend, Mr Killen noted the full year payment
constitutes a payout ratio of 103%, continuing the recent practice of payment of dividends in excess of yearly profits. However, he did note that the Board’s expressed policy was to pay in the range of 70 – 90%, and in future there would be stricter adherence to this policy in the interests of maintaining a strong balance sheet capable of supporting the needs of the business, including its continuing desire to expand by acquisitions.
The results were affected by some one-off and non-recurring acquisition-related expenses and duplicated staff costs during the implementation of the new investment management system. Details are provided in the Shareholder presentation pack.
Equity Trustees’ Managing Director, Mr Robin Burns, added that although the 2011 financial year had again provided some difficult circumstances and business headwinds it had been a very active and positive one for the Group in a number of areas.
He said, “In particular we are very pleased that we completed the acquisition, transition and integration of the OAMPS corporate superannuation fund into the existing EquitySuper master trust in a very efficient manner, to a tight deadline and within our project timetable and costs.”
“We have implemented a number of structural changes within the Group, to enhance our focus on key business activities and objectives, and we will be looking to further develop a group-wide approach to management and integration across business lines.”
He added, “In the last few weeks we have completed the acquisition of a specialised
advisory business, which fits very closely with our values and ethos in looking after our
clients and is in a very attractive market segment. This business, operating as Lifetime Planning and Tender Living Care, provides a number of services in the aged care advisory sector and will be a strong complement to our existing Wealth Management and Personal Estates and Trusts operations.”
“This acquisition has been fully funded from internal resources. We will continue to assess the acquisition opportunities we are seeing in the broad wealth management industry but we take a disciplined approach and maintain a set of basic criteria that guide our acquisition process, including that they are earnings accretive in the near term.”
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