Diversified investment house Washington H. Soul Pattinson says its regular profit fell by a third to $124.7 million in the six months to January 31.
The company posted a 71.5 per cent decline in statutory profit for the half-year to 50.98 million, which includes non-regular items from a year ago such as the sale of 160 Pitt Street and the write-off by TPG of their aborted mobile network rollout.
However, its preferred metric – the gross value of its portfolio, increased 0.2 per cent in that period.
It noted that since February 1 through Wednesday, its share price has declined 10.7 per cent compared to a 29.7 per cent plunge in the All Ordinaries index amid the coronavirus crisis.
“We are pleased that the diversification of the portfolio and focus on resilient businesses which can perform well even in difficult conditions has placed WHSP in a good position to weather the storm we are seeing in financial markets,” Chairman Robert Millner said.
Its biggest investment, TPG, is a consumer staples business that should see more demand for its products as people are increasingly working remotely, Mr Millner said.
TPG’s impending merger with Vodafone will allow it to offer value-focused products that will become increasingly attractive, Mr Millner said.
He was also optimistic about Soul Pattinson’s investments in Brickworks and pharmaceutical companies Apex and API.
Soul Pattinson announced a fully-franked interim dividend of 25 cents per share, up from 24 cents per share a year ago.
Mr Millner said the investment house was cautious during during the bull run last year and positioned itself to make new investments during any market correction.
He believes it would be able to increase its dividend again later this year, even as many other ASX-listed companies will be cutting theirs.
At 1146 AEDT, Soul Pattinson’s share price had rise 2.2 per cent to $19.67.
WASHINGTON H SOUL PATTINSON HALF YEAR:
* Regular profit after tax down 33.2 pct to $124.7 million
* Statutory profit after tax down 71.5 pct to $51 million.
* Revenue up 0.3 pct to $725.5 million
* Fully franked interim dividend of 25 cents, up from 24 cents year ago.