ASSET MANAGEMENT
Why Anchor Group's share price stumbled
Operating profit fell 22% to R73m, while margins were squeezed
Anchor Group’s share price fell 5.66% on Wednesday to R5, reversing gains after the asset manager reported an expected double-digit earnings drop. The stock had partially recovered from a 15% drop after an August 7 profit warning. It weakened on Wednesday after the company said headline earnings per share for the six months to June fell 39% on the same period in 2016 to 22c. Operating profit fell 22% to R73m, while margins were squeezed. Costs rose 60% to R172m on newly consolidated businesses and investment into the company. Losses from subsidiaries including hedge fund manager Capricorn, were R800,000. The result was disappointing, but growth in the asset base and a positive client experience underpinned growth prospects, Anchor Group said. Asset managers have been hurt by low domestic savings and a subdued stock market. Anchor’s assets under management and advice grew 9.7% from the previous comparable period, to R49.4bn. Anchor’s domestic business continued to fare well, said Ant...
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