Count backs its independence
By George Liondis
THE part sale of Professional Investment Services (PIS) is beginning to cast aspersions on the future of the country’s other large independent dealer group, Count Financial, but managing director Barry Lambert has sent a clear message that the business is not for sale.
Lambert had to fend off questions about the future ownership of the group last week as he announced a better than anticipated $4.99 million half year after-tax profit.
UK-based insurer Aviva bought a 20 per cent stake in PIS — the country’s largest independent dealer group — last month.
The move was largely seen as a defensive strategy by Aviva to protect the $2 billion that PIS — which was also being chased by ING — invests through the Aviva-owned Navigator master trust.
Count has almost $3.5 billion invested through platforms, more than $2 billion of which is in BT’s wrap service.
But Lambert said there were few parallels between Count and PIS, which actively sought out a buyer.
“There is no prospect of Count being sold,” he said.
“If there was a prospect, there wouldn’t be any unless there was a mechanism where Count could be sold and still remain independent.”
Lambert said Count had been pursued by institutional groups in the past.
“There are lots of companies out there that have their names on buildings all over town. They would all like to buy Count. But they now have the message that Count wants to stay independent,” he said.
The better than expected half year result for Count means it is now expecting to record a $15 million operating profit for the year to the end of June — up from the $14.1 million it had previously predicted.
The group will pay shareholders a one cent “Easter” dividend in April on the back of the result, which was buoyed by a 38 per cent growth in asset-based income to $6.7 million, largely from platforms.
Income from fees and commissions grew 10 per cent to $5.97 million.
Lambert said the group had also cut spending on information technology and culled a number of under-performing practices in order to contain expenses.
The number of Count practices actually fell during the half year, Lambert said.
While Count would continue to focus on growing its practitioner base, Lambert said new practices wanting to join the group would have to go through a trial phase where they could sell only Count’s loans and leasing products. Those that perform well enough will then be invited to become part of Count’s wider financial planning business.
“We have been looking at our business in recent times and looking at what is working and what is not and deleting those parts that are not. As a result, we have had a reduction in our expense ratio,” he said.
Count also announced last week it had formed a new subsidiary — Count Margin Lending Broking — in a joint venture with former employee Jody Sherring.
The business will provide an equity lending broking service to executives who need funds to exercise company share options.
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