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December 7, 2012 11:19 pm
Wealthy investors entering bidding wars for rare coins have boosted profits at Noble Investments, but the coin and stamp dealer’s performance has been marred by a failure to recoup money from a Qatari client.
Noble’s auction business trebled its profits in the 12 months to August 31, offsetting a halving of profits in its retail business and pushing pre-tax profit at a group level up to £3.7m – a 23 per cent increase on the previous year.
“[Investors and collectors] want the important, rare, high-quality coin and they are prepared to fight it out in an auction,” said Ian Goldbart, managing director of Noble Investments.
He said several coins had sold for record prices at recent auctions, most notably a 1920 George V Sydney mint coin, which fetched £780,000 in September and encouraged more collectors and investors to sell their coins at auction.
Mr Goldbart said the company’s auctions had attracted new bidders in the past few years, as investors who would traditionally have bought bonds or property sought to diversify into alternative assets, such as stamps, wine or coins.
“People quite like a portable, tangible asset. If everything goes pear-shaped . . . they’ve got under their bed or in the bank . . . a beautiful collection of rare coins,” Mr Goldbart said.
Revenue from the auction business more than doubled to £4.9m this year.
However, in a statement to shareholders on Friday, the company said it was still seeking £2.2m owed by a “well-known Qatari collector”. High Court documents name him as Sheikh Saud Bin Mohammed Bin Ali Al-Thani.
It represents a commission owed to Baldwin’s, Noble’s main subsidiary, for ancient Greek coins bought by the sheikh earlier this year. The sheikh spent nearly $20m on the coins, which form part of a collection that Noble said had taken 40 years to put together.
After a trading update in October, Mr Goldbart said that the company had no doubt it could recoup the money. But on Friday the money was still outstanding and the company said it was seeking legal advice and “taking necessary steps to protect AH Baldwin’s position”.
Last month, the High Court issued an asset-freezing order for $15m against the sheikh. On Friday, Mr Goldbart said the move marked progress toward retrieving the money, adding that “it might focus people’s minds”.
The company’s revenue slipped slightly in the year to £12.4m, from £12.7m in 2011, but it increased its recommended dividend by 22 per cent to 5.25p
Shares in Noble Investments’ were up 1.4 per cent on Friday to 185p.
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