Count Financial ups incentives to attract quality advisers

Count Financial has revealed it is offering fee discounts of $10,000-$15,000 per adviser in order to attract quality advisers to the business and compete against rivals as adviser departures weigh on its financial year results.

It saw net profit after tax (NPAT) of $1.09 million, down from $1.78 million in FY20, with significant changes in the second half of the year as grandfathered revenue dropped from $3.2 million in FY20 to $0.13 million, its company results said.

Some 76 advisers left the business, including 10 in June, while it onboarded 56 new advisers which brought the FY21 total to 248, 89% of whom had passed the Financial Adviser Standards and Ethics Authority (FASEA) exam. The total was 20 advisers less than in FY20.

Advisers produced 17,690 advice documents, up 46% from 12,158 in FY20, which worked out to be an average of 71 per adviser.

Related News:

It also alluded to “competition” with rivals to recruit quality advisers, saying: “Competition by some players to recruit quality advisers has included significant fee discounts and other incentives.

“To effectively compete in the current dynamic market, fee discounts ranging from $10,000 to $15,000 per recruited adviser for six to 12 months have been provided. Given the short-term nature of these fee discounts we have made this trade-off against short-term earnings to build a stronger cohort of quality advisers with a medium and longer-term perspective.”

It said there was a pipeline of 69 firms and 199 advisers with total potential gross business earnings

The combination of the adviser departures, tapering fee discounts and cessation of grandfathered revenue meant a clear earnings ‘run rate’ would not be seen until 2H22 or 1H23.

In his shareholder letter, CountPlus chief executive, Matthew Rowe, said: “There is a supply-side constraint in financial advice, but we believe there is a growing unmet need for quality financial advice in Australia. A repurposed Count Financial stands ready to take advantage of the increase in consumer demand for high-quality financial advice in Australia.

“Timing of adviser departures weighted to the first half, short-term onboarding fee discounts and the cessation of grandfathered revenue all show a business in transition, but with a persistent focus on longer-term strategic growth objectives.

“It is our view that Count Financial has the potential to become a significant contributor to the earnings of CountPlus in the medium term.”




Recommended for you

Author

Comments

Comments

Hypocrite, so two wrongs make a right? He's whining about competitors reducing fees and crying about it but then does the same. Man up Rowe. You should be able to sell your wares based on your value proposition. If you can't then your value proposition is rubbish or you're too expensive. Sheesh, and he's running the joint?

So many licensees and not just Count are dropping their fees to insane and non-commercial levels for a few years and then spiking them but making leaving them almost impossible by refusing to provide Client Letters of Release or trapping data in their in-house or controlled software. So existing advisers pay more and get less service and new advisers get trapped. Advisers who join any AFSL who has a focus on "maximising shareholder value" is eventually in big trouble they just choose to ignore that reality to save some money or believe the lies they are fed by idiot senior management who are protecting their salary.

Maybe licensees are coming to realise that charging $1,000 per week to summarise some RG's is over the top and the market isn't accepting it. If everyone is discounting their fee maybe the fee is too high.

Yep agree with 'Really?' they are suck these firms in, then up fees once their shareholders start crying poor. A race to the bottom because of shrinking adviser numbers. Meanwhile the thriving IFA community just get on with it.

Count, Centrepoint, Sequoia, - all these listed groups are just the same thing with different brands. Only thing they have in a common is a terrible business model.

Might as well add AMP and IOOF to that list. They all have a business model which is based on distributing inhouse products through advisers they control via a ridiculous licensing system. It is unsustainable. Idiot Hayne gave them an unexpected reprieve, but eventually someone with common sense will fix it.

You could not pay me to join Count. Does count still require letters of release signed individually...and when not received they keep trailing commissions and have what's called "Orphan" clients....oh wait that's right commissions were banned...oh and volume bonus were stopped....opps my mistake....but for the life of me, I can't help but think about which parties contributed to a Royal Commission, over regulation and Government intervention....I'd have to COUNT the parties that contributed....Thanks Count for your contribution to the Advice Industry. What a legacy.

Add new comment