Société Financière Privée S.A., Geneva, reports slowdown in revenue and income
Subsequent to a phase of extraordinary growth in 2000, the massive decline in stock market transactions throughout 2001 put a damper on the revenue and income reported by Société Financière Privée S.A. (SFP), a Geneva-based financial services provider listed on the SWX Swiss Exchange. However, SFP, whose core business is prime brokerage for independent asset managers with a focus on asset allocation, portfolio management, equity and forex trading, and global custody, was able to significantly strengthen its equity base despite the slowdown in expansion.
The perceptible slump in trading cut SFP's gross revenues in 2001 by 27.5% to CHF 21.3 (PY: 29.4) million. Service fees and commissions closed at CHF 23.4 (48.5) million, resulting in a 32.4% decline in net income to CHF 12.9 (19.0) million. Net interest income decreased by 18.8% to CHF 8.6 (10.5) million. The CHF 0.2 million loss in trading income was followed by a gain of CHF 0.4 million. Conversely, operating expenses rose slightly by 3.2% to CHF 15.0 (14.5) million. Of this amount, payroll expenses account for CHF 8.5 (8.2) million. The year-end full-time personnel count was 54 (56). Other operating expenses increased to CHF 6.5 (6.3) million.
For the year 2001, SFP reports CHF 6.3 (14.8) million in gross income, down 57.4% from the prior year. After an aggregate deduction of CHF 3.0 (7.5) million for depreciation, value adjustments, provisions, and losses, net income for the period closed at CHF 3.12 million, 41% lower than in the previous year (CHF 5.30 million). Earnings per share amounted to CHF 21.63 (39.50) based on the year-end share capital of CHF 14.43 million. The capital base is represented by 415,000 registered shares @ CHF 10 par and 102,806 bearer shares @ CHF 100 par. The number of bearer shares increased by roughly 10,000 following the redemption of the 1994 convertible bond issue that matured in 2001.
At the end of 2001, equity before appropriation of retained earnings amounted to CHF 71.1 million; in comparison with the previous year (CHF 62.8 million), this represents an increase of 13.2%. The convertible bond floated in 1994, recognized with an amount of CHF 9.1 million as at the end of 2000, has now been fully redeemed. Total assets declined by 18.8% to CHF 149.4 (184) million, reflecting a massive decrease of liabilities to clients by 54.5% to CHF 38.7 (84.8) million and an increase of liabilities to banks to CHF 17.1 (1.2) million. At the same time, amounts due from banks were halved, closing at CHF 30.4 (60.2) million, and amounts due from clients fell to CHF 76.9 (88) million.
The Board of Directors will propose to the General Meeting of Shareholders on April 18 to ratify a dividend payout ratio of 14 (15)%.