Strong adviser recruitment prompts Centrepoint earnings upgrade
Centrepoint Alliance has upgraded its financial results for FY24, thanks to licensee revenue and the acquisition of Financial Advice Matters (FAM).
Earlier this year, the firm forecast a range of $8–9 million EBITDA pre-LTI and one-off costs and the licensee has now upgraded this to $8.75–9 million with further growth expected in the following year.
For its first-half results in February 2024, the firm reported a net profit after tax of $4.9 million, a 63 per cent rise from $3 million in the previous period. EBITDA was up by 11 per cent to $4.1 million from $3.7 million, while the firm’s revenue grew by 4.7 per cent to $140.5 million.
Chief executive, John Shuttleworth, said the firm is a leader in financial adviser recruitment with 556 authorised representatives, some 46 who have joined since the start of the 2023–24 financial year.
Key factors behind the firm’s performance are:
- Growth in the licensee services revenue due to the full-year impact of advisers being recruited during the 2023 financial year.
- Ongoing prudent expense management, particularly the efficiencies leveraged from the operating model and technology-enabled productivity savings.
- The successful integration of Financial Advice Matters Group.
Centrepoint acquired 100 per cent of Brisbane-based Financial Advice Matters in December 2023, and the licensee said its performance has exceeded expectations. At the time of the acquisition, the firm had 1,450 client households and funds under advice in excess of $1 billion with eight offices across Queensland.
“A continued focus on growth in new client service revenue combined with operating efficiency improvements as part of the Centrepoint group has resulted in FAM’s earnings contribution exceeding initial expectations.”
It also expects to launch an open architecture investment platform IconiQ in FY25 and to make its iQ managed portfolios in a separately managed account (SMA) structure available on more platforms, with the option currently on the HUB24 and Macquarie platforms.
Speaking at the time of the first-half results, Shuttleworth said the firm would consider further M&A activity now the FAM acquisition had been completed.
“The type of firms we are looking for are corporatised practices with high-integrity advisers and those with genuine succession plans. We will be looking at additional acquisitions if we find the right business.
“The dislocation in the market is creating opportunities to accelerate movement within the licensed business. We are seeing probably one of the healthiest [adviser] pipelines we’ve seen for some time as firms are opting for a business that has stability.”
AUTHOR
Laura Dew
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