Jarvis Securities plc (LON:JIM) has announced its results for year ended 31 December 2021.
· 12% increase in profit before tax
· 22% growth in interim dividend per share (excludes 2021 special dividend)
· 9% increase in EPS
It pleases me greatly that for the 3rd year running I am commenting on another record-breaking set of results. Our 2020 figures may have been viewed as a pandemic related “one off” but improving on those in 2021 indicates that given favourable market conditions they can be bettered. Given current global events this may prove a challenge in the short term, but the fundamental outlook for the business remains positive.
2021 was very much a year of two halves, with trade volumes high in the first five months but then tailed off in the second half as markets generally became quieter. Overall, the general trend for our settlement and transaction volume continues upwards. Market sentiment can however in the short term overshadow the long-term growth being achieved and future outlook for the business. The cash balances held under administration have continued to grow, but in 2021 we saw the average interest rate achieved on deposits continue to fall. We are now seeing an upward turn and rates earned on new funds are back up to a level not seen for over two years and further increases seem very likely. Looking to 2022 and beyond, my view is that monetary policy is entering a new phase and one which Jarvis is well positioned to benefit from. Much of the cash we administer is maturing in the short term and will be available to capture increases in rates as they materialise. Added to this interest income has minimal associated marginal costs.
Against this positive outlook we are experiencing cost increases from many of our suppliers. Some of these have been passed onto our commercial customers, however we would prefer to offset these cost increases through continued growth in order to maintain our competitive pricing model.
We intend to continue growing the business organically and return profits to shareholders where regulatory capital and cashflow permit. We were able to pay a special dividend to shareholders in 2021 through the cancellation of the share premium reserve. This was not an expensive exercise though it did require High Court approval so some legal costs were incurred but it allowed us to pay out reserves that had built up in the business. Much of the cash for this transaction was generated from the profitable sale of treasury shares purchased. The Board retains the authority to purchase shares to be held in treasury and may repurchase shares if considered to be in stakeholders’ interests.
We have a diversified revenue stream which allows the business to perform in changing market conditions so I continue to be optimistic that the business will continue to thrive.
As always, I would like to thank the staff at Jarvis for their continued hard work.
Annual General Meeting
The Company will today dispatch to shareholders its Annual Report and Accounts for the year ended 31 December 2021, together with a notice convening the Annual General Meeting, to be held at the Company’s offices on Thursday 21st April at 9am. The Annual Report and Accounts and Notice of AGM will also be available from the Company’s website, www.jarvissecurities.co.uk .