Co-founder of Collins Stewart gives up broking for racing

Andy Stewart, the co-founder of Collins Stewart, is stepping down as a director after building the business up into one of Britain's biggest independent stockbrokers.

Terry Smith, the chief executive of Collins Stewart, said Mr Stewart wanted to "step down from the day to day activity". But he said he would still call on Mr Stewart often to play an "ambassadorial" role, because of his continuing close relationship to clients.

The change will however allow Mr Stewart, whose pastimes include a passion for horse racing, more time to watch his steeplechaser, Cenkos, in action.

Mr Stewart, 51, retains his shareholding in the business, which is worth £15m. He could begin to sell later this year under the terms of the lock-in deal agreed when Mr Stewart and others floated the business on the stock market in October 2000 for £326m. It now has a market capitalisation of £640m.

The company also announced a drop in operating profit before goodwill from £32.9m to £32.2m in the 12 months to 31 December 2002.

The company has just completed a £250m acquisition of Tullett, the second-largest money broker, despite some shareholder grousing about the options package being granted to Tullett staff. Collins Stewart plans to add the Tullett name to its own.

Mr Smith predicted stock market conditions would "continue to be very tough" this year. "The UK market looks cheap but there is nothing to say it won't remain cheap or get cheaper. US fundamentals are getting worse," Mr Smith added.

Addressing the thorny issue of the collapse in the split capital investment trust sector, Collins Stewart said it had spoken to the Financial Services Authority about its role as broker to a number of splits, but was confident it had not mis-sold products to clients. It has not made a provision for possible compensation.

The company, one of the few to be expanding rather than contracting its coverage of small cap stocks, reported a 66 per cent increase in revenues from this part of the business.