Insignia reports 39% NPAT rise
Insignia has announced net profit after tax (NPAT) of $51.2 million for FY23, a rise of 39 per cent from the previous year.
In its full year FY23 results, the licensee said this year's NPAT sum compared to $36.8 million in the year to 30 June 2022.
This was driven by gains of $43.2 million on the sale of Australian Executor Trustees (AET) which it sold to Equity Trustees in a $135 million transaction last year and was partially offset by lower revenue and higher transformation and integration expenses.
In its advice division, where it recently announced a move to create a new ownership model called Advice Services Co, it said the firm has 1,413 advisers in its network and 461 practices.
ASC will be a partnership ownership model for self-employed licensees comprising RI Advice Group, Consultum Financial Advisers and TenFifty.
The total number of advisers was down from 1,600 in June 2022 which Insignia attributed to regulatory change, the closure of the Lonsdale licensee, the departure of two member practices and the reshaping of the Bridges business.
The total was divided by 686 advisers in its adviser services division, 485 who were self-licensed and 242 in professional services.
It is also supporting 20 graduate advisers through their Professional Year and has another 42 underway.
Funds under management and administration (FUMA) was $295 billion, down from $297 billion in FY22 which was driven by $16.1 billion in outflows associated with AET and JANA and $2.9 billon of pension payments, offset by $15.8 billion in favourable market performance and $0.7 billion in net flows.
The firm announced a strategic refresh which is focused on improving clients’ financial wellbeing, deepening its partnerships with advisers and employers, simplifying the business and building a safe and trusted business.
This new 'client wellbeing' division will prioritise pre-retirees via intra-fund advice and proactive engagement, it said, to enable continued engagement through the client lifecycle. This has the "ambition to create financial wellbeing for every Australian".
Chief executive, Renato Mota, said: “The past financial year saw us reach important milestones in the integration of MLC, the transformation of our business and the creation of Insignia Financial, providing the foundation for unlocking future growth.
"FY23 was a year of achievement. A year of delivering on our promises – evidenced by our net funds flow outcomes, simplification, product improvements, and exemplified by a number of awards and client outcomes.
“We are two years into our journey to creating Australia’s leading financial wellbeing organisation, and it is our achievements to date including the accelerated delivery of benefits that created the opportunity for us to refresh our strategy to drive focus and position us to deliver on our ambition.
“While the result was impacted by lower average FUMA following investment market falls in 4Q22 as well as strategic repricing decisions, our reduction in operating expenses highlights the benefits of deliberate strategic decisions, and the achievement of our net positive inflow target demonstrates the strength of our go-forward proposition.”
AUTHOR
Laura Dew
Recommended for you
Sequoia Financial Group has declined by five financial advisers in the past week, four of whom have opened up a new AFSL, according to Wealth Data.
Insignia Financial chief executive Scott Hartley has detailed whether the firm will be selecting an exclusive bidder for the second phase of due diligence as it awaits revised bids from three private equity players.
Insignia Financial has reported a statutory net loss after tax of $17 million in its first half results, although the firm has noted cost optimisation means this is an improvement from a $50 million loss last year.
With alternative funds being described as “impossible” for fund managers to target towards advisers without the support of BDMs for education, Money Management explores the evolving nature of the distribution role.
