Jobs on the line at Beeson Gregory as technology start-up losses mount

Beeson Gregory, the self-styled New Economy investment bank, warned it could axe jobs later this year after interim results showed its bonus pool shrank from £9.5m to zero in the first half.

The bank raised £30m when it floated on the stock market in April 2000 and invested £18.9m in technology start-ups. The portfolio is now valued at £10m.

Beeson made provisions of £8.8m against losses on its investments, sending it to a half-year pre-tax loss of £5.59m. In the same period last year, pre-tax profits were £11.4m and provisions were just £500,000.

Charles Byford, the finance director, said the provisions reflected the risk that many of the start-ups would struggle to raise fresh funds for working capital. "But only two or three are having real problems," he said.

Outside its own investment activities, Beeson has been hit by the downturn in the new issues market, contributing to a fall in turnover from £26.4m to £8.36m. Last year, the bank made huge fees from bringing a raft of technology, software and biotechnology companies to market.

At the operating level, it posted a £3.2m profit and expected to continue trading "marginally profitably" throughout 2001.

The headcount had fallen by only five to 128 since the beginning of the year. But Mr Byford warned: "It's likely that numbers will be lower by the end of the year. Some roles may no longer be necessary."

He added that he did not expect the new issues market to recover until 2002, though there was still an appetite for quality offerings. "We don't see a major change taking place in the autumn. People are more sceptical."

Shares in the company fell 3p to 121.5p. They reached a peak of 357.5p in December after floating at 300p a share.

Quoted rivals such as Teather & Greenwood and Seymour Pierce have also suffered sharp declines in their shares over the same period.