Revenue doubles at hedge fund Trafalgar
UK hedge fund manager Trafalgar Asset Managers increased its revenue by half and quadrupled its pre-tax profit to almost £15m (€19m) last year, in advance of selling a significant stake to Goldman Sachs investment vehicle Petershill.
Trafalgar recorded income of £26.1m in the year to 30 November 2007, according to the accounts of Trafalgar Asset Managers Limited filed last month at Companies House. This was an increase of 49.6% on the revenue it recorded for the previous year.
The increase reflected an increase in the firm's assets under management, on which it charges annual management fees, and positive returns on its funds, of which it takes 20% as a performance fee.
The firm ran 11 funds last year and saw its assets under management increase from $954m (€687m) in November 2006 to $1.6bn a year later. It did not disclose the performance of its funds.
Trafalgar Asset Managers' directors said in the accounts, dated March, that they expected continued growth in operations. A source close to the firm said its funds had performed well so far this year, and its assets have risen to $3.3bn, according to its website. Trafalgar declined to comment for this article.
Administrative expenses fell last year from £14.8m to £11.6m. The fall arose because pension costs fell from £8.8m to less than £700,000, which was partially offset by an increase in wages and salaries from almost £3.7m to almost £8.2m. Its average number of employees, including directors, increased from 21 in 2006 to 28 last year.
Petershill this April bought a stake of just under 20% in Trafalgar Asset Managers, according to documents filed at Companies House. Petershill is understood to have paid between $50m and $100m for the stake.
--write to whutchings@efinancialnews.com
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