Gresham House plc (LON:GHE) Chief Executive Officer Tony Dalwood caught up with DirectorsTalk for an exclusive interview to discuss their latest interim results
Q1: GHE has doubled its AUM to £530 million in 2 years and increased AUM by 50% since the beginning of the year, it’s a fantastic accomplishment. How are you positioned now?
A1: Well, we’re very well positioned for further organic and acquisition growth, we’ve executed that comprehensibly over the last 2 years since this new management team has taken charge, there’s a long way to go but we’ve achieved what we were aiming for ahead of our expectations. We put in place a number of processes and platforms there that are now there to be scaled and we have some very good quality people that have joined the organisation over the last couple of years to implement and execute that. The important take away from that, of course, is the profitability on the business and we’re pleased to announce this morning that we’re ahead of our plan to achieve that and next year we expect to go on and push on in terms of profitability of the business. So, we’re pleased as we leave 2017, enter 2018.
Q2: I think you were referring to the GHE interims which we’re released this morning, what are the main takeaways from that?
A2: I’d say the main takeaway is that the business is growing, particularly the organic growth in the business that we can see through new Assets Under Management (AMU), a new product development launches and Assets Under Management grow from that. That’s leading to profitability as I’ve just mentioned, in a good way, which is clearly a focus for shareholder value over the longer-term and we’ve now got four divisions within the business which is really a positive step in order for this business to be diversified as well as grow from here.
I think the other aspect is that where we have allocated some of our capital in acquisitions, where we’ve made a couple of acquisitions over the last 2 years, they’ve been executed well, we’re exceeding our acquisition return hurdles so we’re very pleased with that indeed.
Q3: You mentioned good progress on Gresham House Asset Management operating profitability, how can we see this developing?
A3: We have momentum there, obviously when you start a business you lay down some factors and some costs in order to scale and grow the business, we’ve done that over the last 2 years and I think, as I mentioned earlier, we’re ahead to turn that from a costing into a new profit situation. So, the aim is to scale the existing platforms, both organically through Assets Under Management growth and inorganically or through acquisition as we have done over the last couple of years with things like forestry asset management business we bought or the private equity business we bought. So, you should hope that we’ll continue with that momentum leading into 2018 and add further shareholder value which could be created as a result of that.
Q4: So, what are Gresham House’s plans for the rest of the year and going into 2018?
A4: The most important thing is first to execute what we have on the agenda today, both in terms of GH Asset Management and its strategy for implementing the acquisitions we’ve made as well as raising further Assets Under Management. Underlying that is for client to receive what their aims are which are good investment performance so the various investment teams, whether they be the forestry, the private equity or the public equity areas, and increasingly recently the infrastructure and housing areas. It’s important that those investments teams are allowed to execute well and continue to work within their capability to achieve the shareholder or investment returns that they’re aiming for within their products.
