Prime posts considerable decline in profit
Prime Financial Group has posted a net profit decline of 115 per cent to $470,000 for the volatile half-year period to the end of December 2008.
The group’s report for the six months ending December 31, 2008, showed net tangible assets per share were down from 24.8 cents to 12.7 cents per ordinary share. The group also disclosed a net debt of $8.22 million and said there was a 30 per cent decline in new business and recurring income in financial planning over the period.
As a result of the loss, Prime will not be paying dividends for the half-year period; in the previous corresponding half-year period ending December 31, 2007, the group paid 1.4 cents per share.
Despite the profit loss, the half-year results showed revenue was up 28 per cent to $6.2 million.
Prime parted with non-core services lines and businesses “that were not making a positive earnings contribution” in the half-year to the end of December 2008, including a 45 per cent equity ownership in Armytage Private, divestment of which realised a $1.66 million capital loss.
Prime’s earnings before interest and tax (EBIT) for the half-year (excluding capital items) were $1.88 million, down from the previous corresponding period’s $2.92 million.
The group anticipates overheads for the next half year to be $900,000 lower as a result of “integration and operational facilities”.
In an effort to strengthen its position against volatile market conditions, Prime said it has made “appropriate adjustments to overheads and operations”.
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