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The Investment Column: Ritblat rides the recovery

A string of acquisitions gave Conrad Ritblat a fillip in the six months to the end of November but growing investment income from the property portfolio was the main factor behind an impressive jump in profits. Turnover almost doubled to pounds 13.9m as fee income rose by 82 per cent to pounds 12.6m, but the 76 per cent jump in profits to pounds 2.16m benefited from trebled investment income of pounds 974,000.

Considering that Colliers Erdman Lewis, acquired in January last year, contributed roughly half the volume and half the profits on the consultancy side in the interim figures, the underlying performance of the original Conrad Ritblat business has been relatively pedestrian.

But fee income is directly linked to the prosperity of the commercial property market as a whole, and chief executive Philip Lewis detects a steady recovery in the prime retail, good-quality office and warehouse and distribution sectors, which is now spreading across the country. .

Staff numbers have been cut by a further 5 per cent and the rationalisation of the group's West End offices is now complete, which places Conrad in a better position than many of its peers in what has been one of the hardest hit sub-sectors of the market during the recent slump.

A rise in the interim dividend of 20 per cent to 1.98p confirms the company's confidence that things are finally improving in commercial property but broker Panmure Gordon left its forecast earnings for the full year unchanged at 19.3p. At 273.5p, up another 4.5p on the day, the shares are still only half their best level three years ago but at close to net asset value it is hard to see much outperformance as long as the profession remains oversupplied and underworked.