Third-quarter profit surged 21% at GMP Capital Inc. despite a slight drop in revenues, the company said Thursday.

Net income for the quarter ended September 30 increased to $8.4 million, or 12¢ a share, compared with $6.9 million, or 11¢ a share reported in the same period a year ago.

Revenues dipped to $71.5 million, down 4% compared with third quarter 2008 due primarily to lower investment banking and commission revenue, partly offset by higher returns from principal activities, GMP says.

“This quarter’s results reflect the slowdown in the markets experienced in July and August which resulted in lower investment banking and commission revenue as markets continued to react to ongoing uncertainty surrounding the global economic recovery,” says Kevin Sullivan, CEO.

“The benefits realized from the cost savings initiatives we launched in late 2008 are contributing to an improvement in our quarterly results, despite the drop in revenue,” Sullivan adds.

Quarterly expenses dropped to $59.2 million, down 14% from a year ago.

Capital markets revenues were $51.3 million, down 12% compared with the year-earlier period, while operating earnings were $13.6 million, up 18% from a year ago.

In GMP’s wealth management segment, revenues decreased to $11.1 million, down 8% compared with third quarter of 2008. Commission revenues were $6.9 million, up 25% compared with the year earlier period. Assets under administration were $4.1 billion as at September 30, 2009, up 11% compared with second quarter of 2009

The board of directors approved a cash dividend of 5¢ per common share.

IE