Appendix 4D and Half Year Report

ASX announcement

Appendix 4D and Half Year Report to 31 December 2015.

  • 1H16 underlying profit before tax of $3.2m, down 26% on the pcp and up 16% on prior period
  • 1H16 statutory NPAT of $0.7m, down 75% on the pcp
  • Fully franked interim dividend of 1 cent per share

Centrepoint Alliance Limited (ASX:CAF) (‘Centrepoint’) announces an underlying net profit before tax of $3.2m down 26% on the prior corresponding period and up 16% on the prior period.

The Wealth business delivered a solid result with an underlying pre-tax profit of $3.5m which was down 13% on the prior corresponding period and up 13% on the prior period. The transformation of the business to a modern wealth advice business is progressing to plan and is well recognised for its competitive offering and trusted team. The move to a fee for service model in May last year resulted in a drop in adviser fee revenues. This is gradually being offset by strong growth in professional advisers to the group. The business also achieved good growth in funds management and salaried advice revenues partially offset by a drop in product rebates.

The Funding underlying pre-tax profit was down 15% on the prior corresponding period and up 48% on the prior period. The premium funding business wrote a record 15,000 loans during the period offsetting commercial insurance premium rate reductions. Premiums funded of $211m was flat on the prior corresponding period and up 26% on the prior period driven by 12% growth in the eastern states.

Statutory net profit after tax was impacted by onerous lease provisions of $0.6m relating to a major premises restructure across the group.

Centrepoint also announced an interim dividend of 1 cps fully franked to be paid on 29 April 2016.

The Chairman, Alan Fisher commented ‘We are pleased with the Group’s progress in executing on its strategy. The market environment in both business lines is challenging so it is particularly pleasing to see the transformation of the Wealth business gaining momentum and the Funding business growing its broker relationships and loans. In a market where Institutional competitors are reassessing their participation, Centrepoint is strengthening its position as the preferred choice for quality advisers and brokers.’

The momentum in the salaried advice channel and the innovative separately managed account service are increasingly important drivers in the Wealth result. Together these investments provide sustainable growth platforms in the post FOFA world.

The investment in people, technology and client solutions in both Wealth and Funding has continued. The Group’s strategy is to achieve sustainable, long term growth by delivering innovative solutions to independent advisers and brokers to support their customer’s needs.

The Group had cash and cash equivalents of $12m as at 31 December 2015. The Group has a strong financial position from which to deliver organic and inorganic growth.

The Group is well positioned in both businesses for sustainable growth by continuing to support professional advisers and brokers thrive in attractive markets.

Investor Briefing

John de Zwart, Managing Director, and John Cowan, Chief Financial Officer, will hold an investor briefing at 10am (AEDT) on Thursday, 25 February 2016.

Centrepoint’s Appendix 4D and Half Year Report are available here.

For further information please contact:

John de Zwart
Managing Director
Centrepoint Alliance Limited
Ph: +612 8987 3002

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