Snowball reports profit fall
Financial planning dealer group Snowball has reported a 31 per cent profit fall in the year to 30 June, 2010, mostly due to the financial impact of the acquisition of Officium Capital earlier this year, the group said.
Snowball’s full year report released to the Australian Securities Exchange showed its net profit after tax (NPAT) dropped from $5.3 million in 2009 to $3.7 million this year.
During the year, Snowball incurred $0.840 million in one-off acquisition-related costs, primarily legal and advice services.
“Acquisition costs incurred in the second half of the 2010 financial year were higher than anticipated, largely reflecting additional legal services required to be engaged due to the complexity of the transaction,” the report said.
However, the underlying NPAT, which excludes costs related to Officium’s purchase, was up 2 per cent and is, according to the company board, “the most appropriate profit measure to best assess the operational performance given its strategy for growth by, in part, acquisition”.
Snowball’s funds under management and advice have increased by 19 per cent, reflecting a contribution of $0.453 million from the acquisition of Officium, the group said.
The company also attributed this increase to positive net new business inflows and favourable investment market conditions.
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