Investor Group hurt by weak markets, but positioned for turnaround
Investor Group, with a figure just shy of $130 million, has reported a 29 per cent increase in group operating revenue for the 12 months to June 2003, despite the weak performance of the group’s financial services division.
While several acquisitions, including four firms from the failedStockfordgroup, pushed operating revenue for the division up by 24 per cent to $32.3 million, depressed market conditions undermined its net profit contribution - down from $5.64 million to $2.28 million in 2002/03.
As a result of this performance and higher amortisation of goodwill charges, consolidated after tax net profit for the group was $4.89 million, a 22 per cent fall on the $6.3 million achieved in the previous year.
However Investor Group managing director Kevin White says the group is now well positioned to take advantage of any upturn in investment markets, which will stimulate demand for financial planning.
“We are building a company with potentially high strategic value as a consequence of its large and stable client base and the major inherent business and financial services demand within that client base,” White says.
The group’s business services division continues to be the backbone of group performance, achieving a net profit contribution of $16.95 million, up 23 per cent on last year, and placing Investor Group as the fifth largest accounting firm by income in Australia.
Investor Group says it expects operating revenue to grow to around $150 million in the next 12 months, with a corresponding increase in operating profit of between 19 and 26 per cent.
White also says that the group may pursue other new business acquisitions “in keeping with the group’s focus on selectively expanding its distribution base”.
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