Incoming stockbroker CEO: ‘The UK still looks cheap to me’
It is an exciting time to be a stockbroker, according to Cenkos Securities incoming CEO Julian Morse, who reckons UK markets are cheap and investors have no other option than to invest in equities.
AIM-listed Cenkos performed well last year. The institutional stockbroking firm secured an underlying profit of £4m and revenue of £31.9m – up £6m from 2019.
In the next few weeks Morse will take over from current CEO Jim Durkin, who is retiring.
Morse said it was an exciting time to be working in the sector, due to the strength in markets and particularly in equities. The incoming CEO shrugged off concerns about a possible market crash to come, saying he thought the UK still “looked cheap”.
“It’s a very exciting time for UK stockbrokers in general because of the markets and the asset class of equities is one of the only places investors can see to put their money at the moment,” he said.
“There’s a bit of talk about bubbles and things but I actually think the UK market still looks cheap… Generally, the UK is cheaper than the rest of the world, so we should be insulated from a bear market, and generally equities globally I don’t think look in bubble territory at all, I think they’re all supported by corporate earnings and people continue to be entrepreneurial.
“I’m relatively relaxed about an impending crash, because I don’t think we’re going to have one.”
Cenkos works to raise finance for its clients on the stock market, and find investors for those companies.
Today the company also announced Lisa Gordon, Cenkos’ non-executive chairman, and non-executive director Andrew Boorman had bought shares in the company.
Gordon purchased 100,000 ordinary shares in the company, while Boorman bought 20,000.
According to current CEO Jim Durkin, Cenkos’ growth in 2020 was driven by an increase in market activity as companies looked to raise capital since the announcement of the pandemic.
Cenkos Securities’ share price jumped 9.77 per cent following the publication of the results.
Durkin said coronavirus had a “minimal impact” on the company’s cost base, having switched to remote working. He said he expected the use of new technology to continue at the firm, and that it planned to change its office space in response to a new way of working.
Change at the top
Last year saw plenty of change at the helm of the company, including a new chairman and a soon-to-be new chief executive.
Jim Durkin announced his impending retirement in December. His retirement paved the way for Morse, who, subject to regulatory approval, will take over.
Lisa Gordon was appointed chairman of the board in June, taking over from Jeff Hewitt.
Morse added: “This is has been a strong year of growth for Cenkos, with revenue up by 2% and underlying profit by 188%, as the impact of changes made to our operations came through and companies looked to the equity markets for ready access to capital.
“During 2020, we raised £900m for our clients, completing 29 raisings including four IPOs. The momentum has carried through into 2021 with a healthy pipeline ahead.”