Hunter Hall shines despite absence of CIO
Hunter Hall Internationalis yet to name a new chief investment officer, despite reporting a 55 per cent increase in funds under management for the first half of the financial year.
Hunter Hall founder Peter Hall says the group does not expect to appoint a new chief investment officer for up to another six months, as the group is reviewing its investment process and does not want to rush into decisions regarding a replacement appointment.
The chief investment officer role has been left vacant since Kim Tracey left the group in November to take up a senior funds management role withMerrill Lynch Investment Managers.
However the open position has not hurt the group which for the six months to 31 December 2003 made an after tax profit of $5.4 million - a figure 240 per cent higher than the result recorded in the previous comparable period.
The group says the jump in profit is the result of a substantial performance fee of $5.3 million generated by good investment performance and outperformance of benchmarks.
During the period funds under management were grew 55 per cent to $752 million, with operating profits from investment management also increasing 50 per cent to $2.7 million. Growth in operating revenue was 35 per cent, taking it to $5.7 million.
Investment income, however, was lower than the previous period due to $49,000 write down on the revaluation of one investment.
Looking forward, the group has forecast revenues of $7 million, and pre-tax profits of $3.5 million for the full financial year - even without including performance fees.
Hunter Hall International chairman Peter Hall says following the completion of the listing of Hunter Hall Global Value Limited the group will have $1 billion in funds under management, and that even “without further increases in funds under management or performance fees, the business should generate revenues of $16 million on a full year basis”.
With a cost base of around $6 million, Hall projects that the group can expect a base annual pre-tax profit of $10 million, generating earnings and dividends per share of about 30c.
Over one year to 31 December 2003, Hunter Hall’s Value Growth Trust returned 35 per cent and the Australian Value Trust returned 24.3 per cent, compared to a 15.9 per cent bench mark.
The Global Ethical Trust, meanwhile, returned 10 per cent against a -0.5 per cent benchmark while the Hunter Hall International Ethical Fund saw returns of 33.1 per cent on an 11.3 per cent benchmark.
The group has declared an interim fully franked dividend of 23.5 cents per share, to be paid on 23 March 2004 to shareholders registered on 9 March 2004.
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