Snowball releases profit guidance

Tony McDonald

Financial services company Snowball Group has announced its profit guidance, with earnings before interest and tax for 2008 approximately $11 million, up 42.3 per cent from 2007.

The group also announced the merger of its accounting business, Outlook Tax and Accounting Solutions (OTAS), with Duncan Dovico (DD), a NSW-based accounting business.

Snowball managing director Tony McDonald said despite increased volatility in the investment markets, Snowball ended the 2008 financial year on a high note, with funds under advice expected to reach $4.5 billion once acquisitions currently underway with Yarra Financial Planning and Mastertek Benefit Consultants conclude in August.

“We expect that securing reliability of revenue streams will continue to be one of the top priorities for all businesses, particularly in the wake of the latest financial market shocks. At Snowball we’ve been working on this for some years, diversifying our advice activities to build in revenue resilience. The results reflect this diversity,” McDonald said.

“Our year end results also clearly show the benefits of our carefully orchestrated acquisition strategy, complementing the group’s strong organic growth.”

From July 1, 2008, OTAS and Duncan Dovico will be amalgamated into one practice offering a full suite of accounting services, with a focus on servicing small to medium enterprises and high-net-worth individuals.

Snowball will own around one-third of the merged entity, which will have an annual turnover approaching $10 million.

According to McDonald, the upcoming merger underlines another cornerstone of Snowball’s ‘revenue resilience strategy’.

“Snowball is poised to turn to our advantage opportunities that may fall out of the current market uncertainty. We’re carrying a very low level of debt and are fired up to pursue our strategy of growing both organically and inorganically,” he said.

“Over the next 12 months our priorities will be diversifying our revenue streams, continuing to grow our corporate superannuation business and identifying opportunities to link up with reputable, well-run businesses that ‘fit our family photo’.”