Investor Group posts positive result
Financial planning and accountancy consolidator Investor Group has experienced strong growth in its financial services division despite tough market conditions, contributing to an overall increase in its net profit by 29 per cent to 3.52 million for the first half of this financial year.
Investor Group yesterday reported that a 53 per cent increase in fee and commission income to $50 million for the six months to December 31, 2001 was a key to its profit growth.
The increase in fees and commissions came mostly as a result of organic growth in the group’s funds under advice as well as from its acquisition of accountancy and financial planning firms Moore Robsons and Prescott Consultants (formerly Ord Minnett).
The group also experienced an increase in income from financial planning activities of 23 per cent, up from 17 per cent in the previous period. In the six month period more than $250 million in new financial planning business was written.
“It has been a tough six months in the market place, but financial planning, despite September 11 and other issues, has continued to grow through increased efficiencies,” Investor Group financial planning chief executive Tim Townsend says.
A large influx of new business also entered the group through its 11 month old wrap service, WealthWrap. Client funds in the wrap service jumped from $30 million as at June 30, 2001 to $184 million at the end of December.
Looking ahead, the company says second half profits would be lower than the first half result because of a seasonal income bias and other costs associated with a revised corporate plan for the group.
However, Investor Group remains confident of its long term outlook as benefits from its financial services strategy and WealthWrap emerge over the next three to five years.
“The thing I like about these results is we said we were going to do these things and we did them. There is a robust financial services model and firms are becoming more focused on financial services and are continuing to improve efficiency and delivery,” Townsend says.
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