Kingswood Holdings has announced a decrease in its operating profit expectations for the year, citing challenging conditions in the U.S. market. Additionally, the company reported a wider pretax loss for the first half of 2023.
Financial Performance
For the six months ending June 30, Kingswood Holdings recorded a pretax loss of £9.9 million ($12.1 million), compared to a loss of £1.7 million during the same period last year. Revenue also declined from £80.4 million to £62.7 million. However, there was a slight increase in operating profit, rising from £4.5 million to £5.0 million, thanks in part to growth from acquisitions.
Revised Operating Profit
Kingswood Holdings now anticipates reporting a pro forma operating profit of £13.6 million for the year, down from the previously guided figure of £14.7 million. This revision is attributed to lower-than-expected activity in investment banking and capital markets in the U.S., as well as a more cautious approach towards users of its alternatives division. However, the company notes that its U.K. and Ireland business is performing in line with expectations.
Growing Assets Under Management
Despite the challenges, Kingswood Holdings saw an increase in assets under advice and management, which reached £12.0 billion by the end of June, up from £10.5 billion six months earlier. The company is making progress towards its near-term target of reaching £12.5 billion.
Future Outlook
Kingswood Holdings remains optimistic about future growth, expecting further organic growth and positive net inflows in the second half of the year.
At 0739 GMT, shares of Kingswood Holdings were down 1 pence, or 5.6%, at 17 pence.