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STM Group

  • BY: Andrew Hore |
  • POSTED: 04/03/2008 |

Corporate and trustee services provider STM Group beat profit expectations for 2007. 

STM was put together during 2007 and even the core Fidecs business was only owned for nine months. Therefore pro forma figures for the whole year give a better indication of progress than the reported numbers.

Pro forma profits were £2.2m in 2007 and earnings per share were 5.9p. The core Fidecs business grew its turnover by 22%.

STM handles 558 trusts and 885 companies. The company only lost two clients it gained from its two more recent acquisitions in Gibraltar. That was better than expected.

STM plans to move into new jurisdictions and offer additional services. At the end of 2007 it bought a Jersey-based business. Business that was previously given to outside companies in Jersey could now be brought back in-house. STM wants to add other operations in Jersey and move into a new jurisdiction during this year. STM is also setting up its own life insurance business and hopes to get its licence soon. It believes that this will differentiate it from competitors.

The shares initially rose 1p to 69.5p. House broker Daniel Stewart has held its 2008 forecast at £2.8m, which puts the shares on 10 times earnings. A maiden dividend of 0.7p a share is also forecast. It forecasts a further increase in profits to £3.1m in 2009.

These figures, though, will be overtaken by events. More acquisitions will be made which should boost profits and, hopefully, earnings per share.

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