IFG up­beat de­spite slide into the red

Irish Examiner - - Business - Ge­off Per­ci­val

Ir­ish-founded fi­nan­cial ser­vices group IFG has ex­pressed con­fi­dence in see­ing a marked fi­nan­cial im­prove­ment next year after re­struc­tur­ing and le­gal costs dragged it into the red in the first half of this year.

The spe­cial­ist pen­sions and fi­nan­cial ad­vi­sory group — which sold its Ir­ish op­er­a­tions in 2014 to fo­cus solely on the UK mar­ket — is­sued a profit warn­ing last month and yes­ter­day re­ported an op­er­at­ing loss of £100,000 (€108,000) for the six months to the end of June — down from a profit of £4m for the same pe­riod last year.

IFG in­curred ex­cep­tional costs of £2.7m re­lat­ing to le­gal and re­me­di­a­tion costs con­nected to a probe into an in­vest­ment scheme sold to clients of its James Hay spe­cial­ist pen­sion unit.

The group is in talks with the UK’s rev­enue ser­vice on the mat­ter but has warned that un­cer­tainty as to the tim­ing of a con­clu­sion could weigh on full-year earn­ings.

How­ever, both the James Hay and Saun­der­son House fi­nan­cial ad­vi­sory arm saw strong new client ac­tiv­ity in the first half. “Both busi­nesses are de­liv­er­ing strong growth in clients and as­sets.

“Whilst short-term fi­nan­cial per­for­mance is be­ing im­pacted by the low in­ter­est rate en­vi­ron­ment, re­struc­tur­ing costs and the res­o­lu­tion of le­gacy is­sues, we ex­pect a much im­proved sec­ond half un­der­ly­ing per­for­mance — par­tic­u­larly in James Hay, as the ef­fects of repric­ing and re­struc­tur­ing start to bear fruit,” said IFG chief ex­ec­u­tive James Cot­ter. “We are con­fi­dent that both busi­nesses are on a strong growth tra­jec­tory and that the un­der­ly­ing per­for­mance will trans­late into a much im­proved fi­nan­cial per­for­mance in 2018.”

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