US Edition It's been a particularly difficult year for St James’s Place, and not just because the wealth management company has had to draw in customers who have less cash to invest.
The FTSE 250 group, which sells insurance, pensions and unit trust products, has also had a large question mark hanging over its ownership. High street bank HBOS, which is in the throes of being taken over by rival Lloyds TSB, has fuelled that uncertainty as it owns 60pc of the company.
St James’s chairman, Mike Wilson, yesterday attempted to remove any concerns surrounding the group’s future as the company reported that total new business for the nine months ending September 30 rose 2pc to £322.6m. Mr Wilson was also confident that HBOS’s 60pc stake will simply be transferred over to Lloyds after the takeover.
So it’s business as usual for St James’s and the latest set of results beat expectations. Analysts had predicted that third-quarter sales would fall 4pc but they were level at £101.9m. As expected with the market turbulence, funds under management fell 9pc this year from £16.5bn but this is respectable considering that the FTSE All Share has dropped 24pc over this period.
St James’s sells its financial products to high-net-worth individuals through a partnership of about 1,250 self-employed financial advisers and currently has no plans to trim back this network. In fact, it is still recruiting, suggesting that despite the market turbulence it remains confident it can weather the downturn.
Shore Capital said St James’s had delivered “an excellent performance given the tough comparatives and market conditions” and does not deserve to be trading at a discount to its net asset value of 230p at the end of September. Equity markets may well continue to be challenging but the outlook for St James’s looks slightly more certain. Hold.