City of London Investment Group PLC Trading Update (4418L)
19 July 2017 - 4:00PM
UK Regulatory
TIDMCLIG
RNS Number : 4418L
City of London Investment Group PLC
19 July 2017
City of London Investment Group PLC
19 July 2017
This announcement contains inside information
CITY OF LONDON INVESTMENT GROUP PLC
("City of London" or "the Group")
TRADING UPDATE
for the year to 30 June 2017
City of London (LSE: CLIG), a leading emerging markets asset
management group, provides a trading update for it's financial year
ended 30 June 2017. The numbers that follow are all unaudited.
Funds under management were US$4.7 billion (GBP3.6 billion) at
30 June 2017 (2016: US$4.0 billion or GBP3.0 billion), representing
a 17% increase in US$ terms for the year. Over the same period, the
MSCI Emerging Markets TR Net Index rose by 24% in US$ terms. Net
asset flows for the year in Emerging Markets were negative c US$306
million (as clients rebalanced into the significant EM equity
gains) while they were positive (c US$26 million) in the
Diversification strategies. Net mandate wins of c US$125 million
are confirmed for early in the new financial year.
Investment performance vs benchmarks for all asset classes was
positive with the exception of Frontier which was marginally
negative.
The Group's overhead for the year to 30 June 2017 is expected to
be GBP11.9 million (2016: GBP10.7 million) and the current monthly
run-rate is c GBP1.0m. A significant part of this increase is as a
result of the fall in GBP vs US$.
For the year to 30 June 2017, the Group expects that pre-tax
profits will be approximately GBP11.6 million (2016: GBP8.0
million), and that profits after an anticipated tax charge of
GBP2.5 million (22% of pre-tax profits) will be approximately
GBP9.1 million (2016: profits of GBP5.9 million after a tax charge
of GBP2.1 million, representing 27% of pre-tax profit). The tax
charge includes an estimated refund of GBP0.4 million relating to
prior years' US state taxes, which if excluded would result in a
Group tax rate of 25% of pre-tax profits. Basic and fully diluted
earnings per share are expected to be 36.9p and 36.7p respectively
(2016: 23.3p and 23.1p).
The Board is recommending an increased final dividend of 17p per
share (2016: 16p). This would bring the total for the year to 25p
(2016: 24p), for dividend cover of 1.46 times (2016: 0.96
times).
The Board confirms the final dividend timetable for the year to
30 June 2017:
-- ex-dividend date: 12 October 2017
-- dividend record date: 13 October 2017
-- payable: 31 October 2017
City of London expects to announce final results alongside
publication of its Accounts for the year to 30 June 2017 on 18
September 2017. The Group's Annual General Meeting will be held on
23 October 2017.
Please see the attached graph which is based on the following
assumptions and includes the estimated cost of a maintained
dividend:
http://www.rns-pdf.londonstockexchange.com/rns/4418L_-2017-7-18.pdf
Assumptions:
-- Starting point Current FuM (end June 2017)
-- Net increase in FuM in 2017/2018 (straight-lined to June
2018):
-- emerging market strategies $250m
-- diversification strategies $250m
-- Operating margin adjusted monthly for change in product mix
and commission run-off
-- Market growth: 0%
-- Increase in overheads: 3%
-- EIP charge: 2%
-- Corporation tax based on an estimated average rate of 23%
-- Exchange rate assumed to be GBP1/$1.30 for entire period
-- Number of CLIG Shares in issue (26.9m) less those held by the
Employee Benefit Trust (1.5m) as at 30 June 2017
This can also be found on our website at:
http://www.citlon.co.uk/shareholders/announcements.php
CLIG shares
In line with his previously announced intention, during the
financial year Barry Olliff sold 500,000 CLIG shares at 400p. Going
forward, his revised intention is to reduce his holding
progressively at 25p price increments, commencing with up to
250,000 shares at 425p and up to a further 250,000 shares at 450p.
His current shareholding is 2,275,186, 8.46% of shares in
issue.
For further information, please visit http://www.citlon.co.uk/
or contact:
Barry Olliff, CEO
City of London Investment Group PLC
Tel: 001 215 313 3774
Martin R Green
Zeus Capital Limited
Financial Adviser & Broker
Tel: +44 (0)20 3829 5000
This release includes forward-looking statements, which may
differ from actual results. Any forward-looking statements are
based on certain factors and assumptions, which may prove
incorrect, and are subject to risks, uncertainties and assumptions
relating to future events, the Group's operations, results of
operations, growth strategy and liquidity.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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