Profits down but Tower building
Financial services companyTower Ltdhas reported a NZ$77.2 million net after tax profit for the financial year to 30 September 2001 and simultaneously announced a new focus on building its Australian operations.
The net profit is below last year’s figure of NZ$80.8 million. But Tower chairman Colin Beyer says the result is stronger than predicted in most forecasts, with the business areas of savings and investments, trustee services, asset management and risk insurance all recording an operating profit.
“Tower’s strong operating profits and performance by our investment team enabled us to largely offset the negative profit impact, which we estimate to be NZ$18 million in the year, of a 30 per cent fall in global equity markets,” he says.
Aligned to the relatively positive result were a number of initiatives which helped grow the Tower business, including the acquisitions of Bridges Financial Services, IOOF Trustees and AXA Health New Zealand.
Alliances were also formed with Cigna, to market risk insurance products to third party databases, and Citibank, to market global custody services to New Zealand institutional investors.
Looking forward, Tower group managing director James Boonzaier says Tower will undergo a series of organisational changes to redirect its focus towards the Australian wealth management market.
The changes, to be implemented over the next 18 months, follow a strategic review of the company and will include the redefinition of core business and the merging or divestment of non-core operations.
Boonzaier says in the next 12 months Tower will also be involved with reorganising distribution channels in Australia in order to more closely align the company with an altered financial services sector following the introduction of the Financial Services Reform Act.
Tower has already undertaken a restructure of its executives team to help implement the changes.
Former Tower Managed Funds managing director Stuart Fish becomes Strategic Change director, in charge of co-ordinating and monitoring Tower’s refocused strategies.
Helping Fish will be Tower group chief operating executive Ken Boag, who takes on the multi channel distribution businesses in Australia, and Tower Health and Life managing director Jim Minto, who becomes chief executive of Tower New Zealand.
Former general manager of Perpetual Portfolio Services Anthony Hunt was yesterday confirmed as the new general manager of Tower Managed Funds.
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