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Why the Bell Financial share price lost ground on its profit report

This morning Bell Financial Group Ltd (ASX: BFG) reported its full-year results for the period ending December 31 2018. Below is a summary of the results with comparisons to the prior corresponding year.

  • Net profit of $24.7 million, up 20%
  • Revenue of $220 million, up 7%
  • Earnings per share of 8.5 cents
  • Funds under advice of $46.8 billion, down 1%
  • Final dividend of 4.25 cents per share full franked
  • Total full year dividends of 7 cents per share fully franked
  • Bell Potter equity capital markets advisory group completed 120 transaction and raised $1.7 billion for clients

This will be a satisfying result for the stock broker and capital markets advisory business that splits its revenue streams between the likes of brokerage fees, capital raising fees, and what it calls portfolio administration service fees among other services it provides to institutional and retail clients.

The 1% drop in funds under advice over the year largely a result of the plunge in equity markets over the final quarter of 2018.

Management declined to provide guidance for 2019 given the unpredictability of equity markets and capital market advisory work likely to come its way.

The stock closed down 2.8% to 85.5 cents and is around 10% higher over the past year.

Others in the mixed financial services space include Perpetual Limited (AS: PPT) and Pendal Group Ltd (ASX: PDL), although Bell Financial Group is unique in that it primarily offers brokerage services unlike the former two.

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Motley Fool contributor Tom Richardson has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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