Corporate lender lifts its profit target to €15m

International Securities Trading Corporation (ISTC), the Tiarnan O'Mahoney-led company that lends capital to financial institutions, yesterday revised upwards its full-year pretax profit target to €15 million from its previous estimate of €13.5 million.

This would be more than double the €6.5 million profit achieved in the full year to the end of September, 2006.

ISTC yesterday posted a profit before tax of €6.8 million for the six months to the end of March. This was a 300 per cent rise on the same period of the previous year. "It's been a very good six months for us, but this is still a very modest company and we have a long way to go," Mr O'Mahoney said.

The company's total operating income was €12.5 million, while its overall operating expenses amounted to €5.7 million. It paid corporation tax of €1 million.

ISTC said its loan portfolio grew to €1.9 billion, up from €492 million in March 2006.

The Dublin-based company raises debt finance from the capital markets and then lends it on to regulated financial institutions. It has loaned money to 165 institutions in 25 countries to date and about 6 per cent of its business has been in Ireland.

Mr O'Mahoney confirmed the company's intention to seek full market listings on the stock markets in Dublin and London in late 2008. "That would be a realistic timeframe," he said yesterday, adding that ISTC would not seek to raise any funds when it lists.

ISTC's shares are currently trading at €328 each in a grey market operated by Goodbody Stockbrokers. They were issued at €100 each in July 2005. With 1.9 million shares in issue, that gives the company a market value at present of about €623 million. Mr O'Mahoney owns 15 per cent of the equity, valuing his stake at €93.4 million.

In a note to clients last November, however, Goodbody Stockbrokers estimated that the company could be worth up to €835 million by the time it floats on the stock market.

ISTC declared an interim dividend yesterday of 75 cent a share.

The identity of ISTC's shareholders has been closely guarded. The company raised €165 million from 220 high net worth individuals in Ireland two years ago through nominee accounts handled by Goodbody and Anglo Irish Bank.

Seán Fitzpatrick, chairman at Anglo Irish Bank, where Mr O'Mahoney was previously a senior executive, has declared that he is an investor. Others linked with the company include Seán Quinn and Denis O'Brien.