Impairment charges have cut a swathe through the half-year result of DKN Financial Group, which has reported a 1031.8 per cent decline in profit after tax to a loss of $13,643,000.
The impairment charges have taken the gloss of a company announcement made earlier in the month. The company said its net profit after tax and before impairment of assets was down 13.67 per cent to $3,087,000.
In an announcement released on the Australian Securities Exchange today, the company reported a $12.11 million impairment of goodwill to reflect the impact of downward valuations caused by market conditions, a $5.63 million impairment of equity investment to reflect downward valuations on investments caused by market conditions and $300,000 in one-off expenses arising from the integration of entities acquired in November 2007.
Looking across the company’s various units, DKN attributed a $9,048 million impairment to platform solutions, a $3,058,000 impairment to Lonsdale Wrap Rebate Solutions, and a $5,634,000 impairment to equity and loans.
Commenting on the result, DKN chairman Robert Hunwick said that as a result of recent market conditions, directors had prudently reviewed the balance sheet and recognised the impairment of assets to date to the value of $17.7 million.
He said this non-cash impairment charge, plus one-off tax affected expenses of $300,000 relating to costs associated with the integration of Lonsdale, had resulted in a reported net loss after tax of $14.6 million.
