FUNDS management groupChallenger Internationalhas reported a drop in net profit, posting only $35.8 million for the half year to December 2002, down from $109 million in the previous corresponding period.
Challenger says the drop was due to a number of one-off items, including a $14.6 million write down of the group’s UK operations and the sale of the group’s broking business to Bell Potter Securities as part of a bid to cut costs.
While the group’s overall figures stayed in the black, the funds management division reported a rise in pre-tax earnings to $24.1 million from $6.7 million.
According to Challenger managing director Bill Ireland, reaping the “benefits of scale in our funds management business” resulted in the rise in pre-tax earnings in that division.
“We’re averaging $50 million to $60 million in net funds growth a week,” Ireland says.
During the six months to December 31, Challenger attracted fund inflows of more than $700 million across its flagship products, including the Howard Mortgage Trust, Synergy master trust platform and Challenger High Yield Fund.
As a result of the increased inflows, research houseAssirthas labelled Challenger the fifth largest recipient of retail investment monies in its December 2002 quarterly reports, posting $11.9 billion at the end of December, up from $9 billion at the end of June.
