Quayle Munro shares fall by 15% on profit warning

City Editor

Thursday 14 June 2012

SHARES in Edinburgh-based merchant bank Quayle Munro plunged 15.2% to a three-year low after it issued a profit warning on the back of a falling number of transactions.

HIGH HOPES: Quayle Munro's senior dealmaker in Scotland, managing director Rob Cormie, had outlined strong opportunities for the company last year. Picture: Nick Mailer

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TIM SHARP CITY EDITOR

Quayle Munro has struggled with a lacklustre market and in March posted a £390,000 pre-tax loss for its first half, although it predicted a "satisfactory result" for the year due to a strong pipeline of business.

However, the company told investors yesterday: "The board now expects that the number of transactions completing, and the associated revenues to be invoiced, in the second half of the year ending June 30, 2012, will be significantly lower than in the first half. "This is likely to result in a pre-tax loss at group level for the full financial year."It added: "The board continues to be encouraged by the pipeline of new and existing advisory business, with the possibility of major transaction completions in the early months of the new financial year."The company declined to comment further.In response, investors sent Quayle Munro's shares down 87.5p or 15.2% to 487.5p. This is its lowest close since May 2009.The move cut £3.6 million from the bank's market value, which now stands at £20.3m.The hostile market environment provides an early challenge for new chief executive Andrew Adams.In March, he took over executive responsibilities from veteran dealmaker Andrew Tuckey, who is stepping down as chairman of Quayle Munro in November. The company is seeking an independent non-executive chairman to replace him.Founded in 1983 as an investment fund bolted on to an advisory business specialising in privatisation finance, it was listed 10 years later.Quayle Munro shifted its emphasis to London and to the wider advisory market in 2007.It joined forces with former Barings director Peter Norris in a £7.5m acquisition of his New Boathouse Capital boutique.It then acquired the Van Tulleken advisory firm which brought in Mr Adams as well as offices in London and New York, although the latter is now closed.Its biggest shareholder remains founder and former chairman Ian Jones, who has a 15.1% stake.After he stepped down in early 2010, Quayle Munro divested itself of most of its investment portfolio to focus on advisory work.Quayle Munro specialises in particular in media, retail, finance and energy deals.In an interview with The Herald last year, Quayle Munro's senior dealmaker north of the Border, managing director Rob Cormie, outlined strong potential opportunities for the firm in areas such as renewable energy and infrastructure advice.Among the deals it is currently thought to be involved in is a strategic review of Wood Mackenzie, the Scottish oil and gas consultancy, commissioned by its private equity owner Charterhouse, which could see it put up for sale.

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Quayle Munro shares fall by 15% on profit warning

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