Perth-based broker Euroz (EZL) has slashed final dividend and the full year payout after a tough 2014-15.
The broker yesterday revealed a $7.13 million loss for the June 30 year, thanks to the falling value of its investments.
Euroz said its bottom line loss reflected a $15 million after tax decrease in the market value of its investments, including Westoz and Ozgrowth.
But the result also revealed a very weak trading performance with pre-tax earnings from normal operations plunging more than 50% to $8.8 million from $20.8 million.
The company said its significant long term investments in Westoz and Ozgrowth continued to have a material affect on its reported profitability. But it said shareholders should be not be worried as the non-cash fluctuations in the investments did not affect the company’s underlying profitability, cash generation or ability to pay dividends.
Euroz declared a fully franked final dividend of 3.25 cents a share, bringing its full-year dividend payout to five cents per shares, more than half the 2014 full-year payout of 10.75 cents. The interim was an unchanged 1.75 cents a share.
EZL 1Y – "Difficult environment" for Euroz
Executive chairman Andrew McKenzie said despite challenging markets, the directors were pleased to be able to generate underlying profits, and pay five cents in fully franked dividends for the year.
“We have worked extremely hard in the past year to closely manage our operating costs and yet invest in appropriate opportunities to refine our existing businesses,” he said in yesterday’s statement.
“We have now laid the foundations for our strategy to build a more consistent base of underlying recurring revenues through our growing wealth and funds management businesses while still retaining the transaction-based upside of our traditional stockbroking businesses.”
Euroz said its acquisition of Blackswan Equities had boosted brokerage revenues by 44%, but lower equity market activity had resulted in corporate income being down for the year.
“Despite this difficult environment, we are pleased that Euroz Securities remains profitable and leveraged to an inevitable rebound in our markets,” the company said.
The company said the proposed acquisition of Entrust Private Wealth Management, announced earlier this month, would lift its funds under management to $754 million. Euroz shares were off one cent to $1.
