The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
Operating profit was £94Mill last year so probably higher than £100mil this year
https://www.thisismoney.co.uk/money/markets/article-11801777/Abrdn-loss-sees-profits-interactive-Investor-double.html
"One swallow does not make a summer" but the first quarter results are encouraging.
As the divi is paid next week I think there could be more upside over the next few days. I would be nervous of being short in this share. I would say more upside than downside now.
Personally I do not think anyone will come forward to buy it in the present climate. Fund managers are really out of favour.
I also do not think the divi will be cut from 14.6p.
£494 billion under management, an 11% share in phoenix giving 60 million a year in divi and 100 million from ii.
The company should be able to generate enough to cover the 14.6p divi.
They still have quite a liot of resources availaible so I suspect the divi will be maintained for tjhe next few years at a minimum of 14.6p a year.
They paid £1.5 billion for ii this generates about 100 million net profit. They have a £600 million investment in Phoenix.
So they have identifiable investments of £2.1 billion.
ABDN is valued at about £2.5 billion they also have £494 billion of assets under management .
I think it will recover slightly over the next 2 years but I am doudtful it will get to £2.
Interest rates coming down should mean more money into equities.
The part of the business, which is a big part, which is not performing is the fund managment side. Which was why Bird was thinking about selling it.
If they can turn this side around and get a net increase of funds invested all will be fine over 5 years.
If they continue to have a net outflow of funds then a vualtion of £2 billion would be about right! 20% lower than where it is now.
On the positive side the adjusted profit figure just about covers the dividend. So they do seem to be making progress.
It seems to me that there is too much pesimism about this share.
It is still paying a cracking dividend. The Adjusted earnings were 14.1p which nearly covers the dividend.
The adjusted earnings is the one the company uses to make dividend decisions.
Interest rates will come down later this year which should mean more monsy coming into shares.
There is an 5% to 8% increase in pension funds paying into ABDN funds. Just to keep up with wage growth.
It still has £494 billion under management.
It makes £100 million prifit on ii. It has a 10% holding in Phoenix.
It has other long term investments. Such as Archax.
Of course there is rsk attached to any investment but given all the differnt income streams the company has. a £2.4 billion valuation seems a tad on the low side.
If you have held this share since 1 Jan 2020 you have already received 65p p of dividend income.
Https://uk.finance.yahoo.com/news/9-dividend-yield-abrdn-share-114806091.html
The standard report does not seem accurate. The company has £494 billion under management. Not less than £40 billion. I do not think the results are that terrible. Managed funds are totally out of favour so this £494 billion may fall further. As long as they make enough to keep paying 14.6p I am happy.
Since 1 Jan 2019 $6 billion of share capital has been bought back. I know many think share buy backs are a waist of money but buying back shares at these low prices really makes sennse. In time the share price will go up.
$5 billion profit each year is now being divided up amongst fewer shareholders. The P/E ratio is 6.5 or so. Something eventually will have to give.
I think the share price will drift up over the next few weeks since in my experience "shorters" hate paying out divi's.
15 March is cut off for a payment on 30 April.
I am neutral on the results and will hold for now. The regular divi helps.
Adjusted capital generation was £299 million this year. Up from £259 last year.
The BOD have reiterated that they will not increase the divi until capital generation is 1.5 times the divi payout.
The divi payout this year, 14.6p, cost £269 million.
So adjusted capital generation needs to be above £400 million before they increase the divi.
I suppose there is an outside chance this may happen in 2025.
He got way off his potential maximum bonus. It is a pretty bad industry to be in at the moment. With these results he has bought himself another year. I am optimistic the tide will turn for ABDN this year. "ii" shoudl be fine. "Advisor" division seems to be doing well. It is just "Fund manager " part £494 billion which is bad. They also own 10% of phoenix so a divi of £50 million a year is pretty much guranteed.
I am optimistic. If I had to buy 1 FTSE share to hold for 2 to 6 years this would be it. Given that $1 billion is being bought back and a furthet $1 billion second half. I do expect the share price to increase this year. 14.1% tier 1 ratio is better than expected. Bil Winters is creating a real cash machine here. With the massive share buy backs and the continued good results sooner or later the share price will shoot up. I am not selling my shares for less than £10. I may be the last man standing.
On the right track. As long as they can maintain the dividend at 14.6p a year I am happy.
It seems that they will probably be able to do this. The adjusted earnings per share is 13.9p so not quite covering the divi.
I think these results means that the share price will "tread water" for the next 12 months. I would not want to be short in this share though since Bird does seem to be making progress.
I do not think it will be taken over. The volumes traded have been falling over the past few years. Even small trades are having a big affect on the share price.
I have confidence in Stephen Bird to turn this around. Todays announcement is good news. It means the divi is safe at 7.3p this Feb. He is taking steps to increase profits etc. The sector is out of favour and interest rates are high. When these start to come down the share price will go up. In the meantime enjoy an 8% reasonably secure return.
I am not worried about this share and less so after the announcement today.
What I worry about is when compnaies do not react to changing conditions or do not have a plan.
At least Stephen Bird has a plan.
I have never seen the volume of shares traded like this before. In 3 days over 60 million shares have been traded. That is well over 10% of all the shares in issue.
If you consider 100 million are held by insiders who have not sold, it is even a higher percentage.
Given there is no update from the BOD I am guesssing this is share price manipulation by shorters.
I doubt there is any point in them doing a fundraisng.
With the market value at £150 million they could in reality raise very little.
Who would put more money in at this price? You might as well write off your investment and invest elsewhere.
My guess is the company would be sold at a knock down price.
I suspect Afari holding 100 million shares will know what is going on.