The company Alantra increased its income by 18.4% during the first quarter of the year, to $48.7 million (€43.5 million), thanks to the good performance of the investment banking business (30.5% more) and advising on credit portfolios (193.9% more).
These figures are an endorsement of Alantra’s commitment to internationalization in recent years, as these two business lines are the ones that have grown the most internationally. The investment banking business is present in more than 20 countries, while the credit portfolio advisory business is present in more than eight.
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The company hopes for a recovery in the fourth quarter
Based on these data, the asset management business has reduced its income during the first quarter to $6.5 million (€5.8 million) due to the absence of successful commissions (from January to March 2019 they achieved $3 million (€2.7 million)) and due to the exit of the perimeter of a part of the Wealth Management business (advice on large assets), which was sold to Mutua Madrileña.
The company’s net profit fell 13.5% during the first three months of the year to $5 million (€4.5 million’), in a quarter that has traditionally been weaker for the company because it is not until months later that the operations it advises are executed. In this regard, it is noteworthy that Alantra expects a fall in profits during the second and third quarters of the year as a result of the coronavirus pandemic and the delay in the execution of the operations advised.
However, the company chaired by Santiago Eguidazu is confident of an upturn in activity in the fourth quarter of the year, although it doubts that it will reach the same figures recorded at the end of 2019.
“Ongoing transactions advised by the financial advisory division are suffering from delays in closing. This, coupled with a more competitive market for new mandates, will impact second and third quarters results, while we expect a recovery in activity for the fourth quarter. As a result of the above, the group expects that the profits generated this year will not reach those obtained in 2019,” explained Alantra in its quarterly report.
The company has a solid balance sheet
However, the company has revealed that it has a solid balance sheet: $237 million (€211.6 million) in equity, $109 million (€98 million) in cash and cash equivalents, and no financial debt.
In addition, thanks to the sale of 20% of the management company (Alantra Asset Management) to Mutua, the company’s balance sheet will be strengthened because the closing of the transaction was completed last May and is not yet reflected in the results presented. Through this operation, Mutua will contribute $50 million (€45 million) to finance the growth of this business line and will create a common vehicle of $112 million (€100 million) to jointly invest in products and funds managed by Alantra.
Furthermore, the company has agreed to take to the General Shareholders’ Meeting, postponed until next October, the payment of a dividend amounting to $0.5 (€0.44) per share and thus distribute the entire consolidated result for 2019.
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This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.
First published in elEconomista, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
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