Davy's makes €25m dividend payout to management and staff owners

IRELAND’S BIGGEST stockbroker, Davy, is believed to have made a distribution of about €25 million to management and staff who own the business.

This is the first time they have received a dividend since the management buyout of the business from Bank of Ireland almost six years ago.

Davy yesterday published the annual summary of its financial statements on its website.

While a profit figure for 2011 is not published among the data released, it is understood that Davy achieved a surplus last year of about €10 million.

The accounts published yesterday show that it had retained profits at the end of 2011 of €110.545 million compared with €124.99 million in the previous year. This €15 million reduction in its accumulated profits is believed to have been the result of the dividend payment to shareholders.

When added to last year’s profit, it indicates a distribution to the 100-plus staff who participated in the management buy-out of €25 million. Davy closed last year with net assets of €131.1 million

This is described as a “strong financial position”, with its regulatory capital amounting to three times the statutory requirement, according to the summary statement published yesterday.

Davy’s fixed assets declined last year to €9.8 million from €10.9 million in 2010. Its current assets fell to €291 million in 2011 from €388 million in the previous year. This included a 31 per cent drop in cash and cash equivalents to €118.9 million.

The total owed to creditors was reduced to €169.8 million last year from €253.9 million in 2010. These were amounts falling due within one year and included “financial liabilities” of €22.2 million.

The broker said it accounted for about 40 per cent of all dealings in Irish equities on the Irish Stock Exchange in 2011.

These figures predate Davy’s recent acquisition of Bloxham Stockbrokers’ private clients division and asset management arm.

Davy was the subject of an MBO in late 2006 when more than 100 management and staff paid €317 million to acquire the 90.4 per cent stake then held by Bank of Ireland.

The Dawson Street-based stockbroker employs more than 450 staff and is led by Tony Garry.

Davy has recorded a profit each year since its MBO in spite of debt servicing costs and the recession.