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Saunderson House revenue rises 4% as IFG readies sale

Saunderson House revenue rises 4% as IFG readies sale

Saunderson House reported that revenue rose 4% to £32.2 million in 2017 as the company’s parent, IFG Group, continues to ready the division for sale.

In its full-year results IFG provided no update on the disposal, which was announced earlier this year, just reaffirming that it is ‘considering the disposal of Saunderson House if shareholder value can be achieved’.

IFG’s discretionary and advisory arm reported that assets under advice grew by 11% to £5.1 billion over the year as it added 247 new clients, raising client numbers by 8.4% to 2,121.

At a group level, IFG said that its Sipp business James Hay continued to suffer from the low interest rate environment and although pricing changes over the year reduced the impact, interest income fell by £5.9 million from £12.6 million to £6.7 million.

Total revenue was broadly flat at £78.4 million, compared to £78.5 million last year.

However, overall, the group incurred an operating loss of £0.4 million, compared to a £6.2 million profit in 2016. This was blamed on the ‘amortisation of intangibles and exceptional costs’, which mainly related to its 2010 acquisition of James Hay, which incurred £8.8 million of exceptional costs ‘due to the remediation of legacy issues an restructuring’ of the division.

The company revealed it is facing a potential £1.8 million tax charge relating to its Sipp division last year, triggering a profit warning. IFG said it will not pay a final dividend this year, owing to the costs emanating from the James Hay business.

IFG group chief executive John Cotter said: ‘We have announced that, following a strategic review early in 2017, we are considering whether a sale of Saunderson House would create greater shareholder value. We are in discussions with interested parties, but will only proceed to a transaction if appropriate value, reflecting the quality of this business, is realised for shareholders.

‘We expect Saunderson House to continue to grow, in line with its current trajectory, and we believe this will deliver an increase in operating margins over time. The growth of the discretionary offering will increasingly contribute to the development of the business as we go forward.'

He added: 'We continue to invest in training and developing our staff to develop a sharper focus on how we engage with prospective clients in light of the evolving proposition, which will allow Saunderson House to penetrate existing and adjacent markets more effectively and efficiently.’





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