Plan B still in black despite impairments

Financial planning dealer group Plan B has managed to stay in the black for the six months to December 31, despite recording a 17.7 per cent decline in funds under management, administration and advice.

The company announced to the Australian Securities Exchange today that it had recorded a net profit after tax but excluding impairment of goodwill of $1.67 million, which it said was at the high end of the earnings guidance previously provided by the company.

However, it said that when impairment charges relating to the company’s New Zealand operations were taken into account, its net profit after tax was $1.29 million.

The company said that overall, earnings before interest tax, depreciation and amortisation and before impairment for the half year had declined against the previous corresponding period by 33.9 per cent.

Commenting on the result, Plan B managing director Denys Pearce said that while the first half result was disappointing, the company remained well-positioned to take advantage of any improvement in market conditions.

“The impact of global investment on FUMA levels and revenue has been significant during the half year,” he said.

“The inflow of new funds to the group’s platforms has also declined as a result of the uncertain economic outlook and investor reluctance to commit new funds.”

Pearce said that, importantly, the level of outflows had also declined relative to the prior financial year and that this reflected the benefits of a well-educated and disciplined client base.

However, he said he was cautious about the remainder of the 2009 financial year in light of the performance of global investment markets.