Yellow Brick Road growing and spending aggressively
One-stop-shop wealth management company Yellow Brick Road has announced a one-third jump in total revenue while more than doubling branch-generated revenue - but increased expenses led to a significant overall loss for the half year to 31 December.
Yellow Brick Road's half-year results to 31 December 2011, originally posted on the Australian Securities Exchange on 28 February, revealed branch revenue increased from $1.47 million in the prior corresponding period to $3.12 million, and overall revenue climbed 31 per cent to $6.7 million.
However a massive jump in marketing and other operating costs from $3.6 million to $6 million resulted in a loss after income tax of $3.4 million, up from $0.5 million in the prior corresponding period.
Funds under management grew by a third to $154 million, while wealth management and investment revenue was also up one third to $1.135 million.
In yesterday's market update, Yellow Brick Road described itself as being in an "aggressive build phase" and said it was suited as an emerging challenger to the current economic environment.
The group said it was moving into a phase where it would look to build on its initial spend and further leverage its partnership with Channel Nine, which invested $13 million into the group last year via shares and free advertising.
The partnership also sees Yellow Brick Road executive chairman Mark Bouris appear on Nine's reality show 'Celebrity Apprentice', the second season of which is due to air in April and May of this year.
Yelllow Brick Road said it would be looking to grow its branch numbers to 125 by 30 June this year after passing 100 in January, and was targeting further growth in wealth management products and selectively moving further into product manufacturing.
Yellow Brick Road also outlined plans to increased its branch advice capability as branches move up the "advice curve" by upgrading their individual advice capability, partnering in the branch, meeting regulatory requirements and referring to YBR specialists.
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