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Arrow Global reports record investment volumes in 2019
12th Mar 2020 16:09
(Sharecast News) - Arrow Global Group reported record investment volumes of ?303.7m in its full-year results on Thursday, with investment volumes at a consistent 17% net internal rate of return.
The London-listed company said its gross asset management and servicing (AMS) income was 5.9% higher at ?140.1m, making up 36.4% of gross total income, rising from 32.9% in 2018.
It said free cashflow was ahead 13.3% at ?261.4m for the year ended 31 December, while profit before tax improved 28.3% to ?51.3m.
It confirmed a full-year dividend 3.1% higher at 13.1p, from 12.7p.
The company said its leverage reduced to 3.4x from 3.7x during the year, which was within the target range, and was continuing to reduce.
It reported an underlying return on equity of 29.5%, down from 34.8%, but still above the board's mid-20s percentage point target.
During the year, Arrow Global launched its fund management business, with €838m in initial funds under management, adding that it was continuing to target €2bn of funds under management by the end of 2020.
"The business performed well against its key operating metrics in 2019, with returns in the investment business remaining strong and improving margins in our asset management and servicing business leading to a 28.3% increase in profit before tax to ?51.3m," said group chief executive officer Lee Rochford.
"This helped increase free cash flow generation by 13.3% to ?261.4m, allowing us to increase the dividend for the seventh year in a row and finish 2019 within our new lower leverage range of 3.0x-3.5x.
"We are excited by Arrow's future prospects and continue to see enormous opportunity to generate strong returns in our chosen markets."
Rochford said the launch of the fund management business was "transformational", allowing the company to capture more of that opportunity while also growing its capital-light earnings.
"Our initial fundraise of €838m was a milestone in our evolution to become a fully-integrated alternative asset manager.
"We believe we can scale this business significantly over time and are continuing to target total funds under management of €2bn by the end of 2020."
At 1600 GMT, shares in Arrow Global Group were down 16.56% at 150.2p.
The London-listed company said its gross asset management and servicing (AMS) income was 5.9% higher at ?140.1m, making up 36.4% of gross total income, rising from 32.9% in 2018.
It said free cashflow was ahead 13.3% at ?261.4m for the year ended 31 December, while profit before tax improved 28.3% to ?51.3m.
It confirmed a full-year dividend 3.1% higher at 13.1p, from 12.7p.
The company said its leverage reduced to 3.4x from 3.7x during the year, which was within the target range, and was continuing to reduce.
It reported an underlying return on equity of 29.5%, down from 34.8%, but still above the board's mid-20s percentage point target.
During the year, Arrow Global launched its fund management business, with €838m in initial funds under management, adding that it was continuing to target €2bn of funds under management by the end of 2020.
"The business performed well against its key operating metrics in 2019, with returns in the investment business remaining strong and improving margins in our asset management and servicing business leading to a 28.3% increase in profit before tax to ?51.3m," said group chief executive officer Lee Rochford.
"This helped increase free cash flow generation by 13.3% to ?261.4m, allowing us to increase the dividend for the seventh year in a row and finish 2019 within our new lower leverage range of 3.0x-3.5x.
"We are excited by Arrow's future prospects and continue to see enormous opportunity to generate strong returns in our chosen markets."
Rochford said the launch of the fund management business was "transformational", allowing the company to capture more of that opportunity while also growing its capital-light earnings.
"Our initial fundraise of €838m was a milestone in our evolution to become a fully-integrated alternative asset manager.
"We believe we can scale this business significantly over time and are continuing to target total funds under management of €2bn by the end of 2020."
At 1600 GMT, shares in Arrow Global Group were down 16.56% at 150.2p.