Dorchester Pacific Ltd has lifted its net profit after tax from $1.72 million in the March 2013 year to $8.21 million.
The company had forecast early in the year its profit would reach $6 million and gave guidance of $8 million in April.
The result includes the full-year trading for Dorchester Finance, DPL Insurance & the EC Credit debt recovery business, but no contribution from Oxford Finance, which was settled on 1 April 2014.
The $8.21 million profit includes 2 extraordinary items:
- a one-off $1.67 million interest prepayment expense relating to $11 million of convertible notes, converted to ordinary shares in August 2013, and
- a $3.23 million gain from bringing tax losses on to the balance sheet.
The balance sheet at 31 March 2014 shows shareholder funds of $74.1 million ($33.2 million in 2013).
Directors have declared a 0.5c/share final unimputed dividend totaling $2.5 million, which equates to 40% of the underlying trading profit of $6.7 million before extraordinary items, in line with the dividend policy guideline last year.
Dorchester chief executive & executive director Paul Byrnes said yesterday the results reflected a completely transformed business with a strong, conservatively geared balance sheet and sustainable & growing trading profits.
He said the funding model & financial structure of the new Dorchester business reflected lessons from the finance sector collapse in the global financial crisis: “Equity is currently funding over 50% of total assets and there is no funding from the public. We have no exposure to property development lending. With the strong financial position and an increasing diversity of earnings, we enjoy very good support from our banking partner.
“Trading profits are expected to increase to around $15 million before tax within 2 years, without any contribution from further merger & acquisition activity.
“What is particularly pleasing is the real potential we can see for organic growth in trading activity for each of the 3 existing businesses and for the just-acquired Oxford Finance business.
“Dorchester Finance is achieving or exceeding all performance metrics month on month. The receivables book is building well, although we are not specifically chasing market share. The focus remains on a quality build that we believe will result from a high & consistent level of servicing of our dealer & broker client network.”
Attribution: Company release.