Craigs' results point to funds management dominance

Craigs Investment Partners’ latest results for calendar 2024 provide some clues about the degree to which it has become more a fund manager than a stock broker, although its merchant banking fees and funds management fees are reported as a single line item.

The results show its brokerage revenue jumped 44.2% to $62.9 million in the latest year while its fees revenue was up 13.4% to nearly three times as much at $186.4 million.

The notes show fees revenue is both from investment banking and underwrite fees and from funds management services with the latter largely a percentage of funds under management.

Craigs also earned $17.5 million from commissions, down from $19.2 million in calendar 2023, taking total revenue for the latest year to $266.9 million, up 17.4%.

Unsurprisingly, personnel costs are Craigs’ biggest expense and rose 16.8% to $166.4 million in 2024.

The firm’s net profit fell 45% to $26.8 million, but that reflected a $30.8 million profit from selling the QuayStreet Funds to NZX in February 2023 included in the year-earlier result. Craigs’ did receive a further deferred payment of $3.2 million from the QuayStreet sale in the latest year.

As part of the payment for QuayStreet, Craigs received $8.75 million worth of NZX shares – those shares were written down to $7.16 million in the 2023 accounts and written up to $9.59 million in the 2024 accounts.

The business paid its shareholders dividends of $18.4 million, or $23.04 per share, in 2024, down from $26.1 million, or $32.67 per share in 2023.

However, after its Dec 31 balance date, on Feb 28, the company declared a $24.7 million dividend which was used to set off a $23.9 million repayment of a loan to CIP Holdings, its ultimate parent company, and $830,702 the parent owed in interest.