Count optimistic on half year ahead

Count Financial expects to back up its strong performance in the first half of 2005-06, forecasting half-year earnings before interest and tax (EBIT) 70 per cent higher than in the same period last year.

Chairman Len Spencer predicted full year results would be up 30 to 40 per cent on the previous year with EBIT at least $21.3 million for the full year, and possibly as high as $23 million.

However, he noted the company’s decision to self-insure, while saving around $1 million a year, would increase the volatility of results.

“We expect the volatility will mostly be on the upside and this has certainly been the case for the 18 months since we cancelled our insurance,” Spencer said.

Managing director Barry Lambert last month said that increases in funds under administration in the recommended platforms would be the main factor behind achieving the company’s forecast of a 30 per cent increase in EBIT to June 2006.

At that time, overall funds under administration had risen by 7 per cent between July and September 2005, and this continued to the end of the half year, with total funds under advice having now risen by 32 per cent to $9.28 billion.

Funds in the recommended platforms — which include three BT platforms, Skandia, Colonial FirstChoice and Perpetual — were up by 40 per cent, and other investments increased by 27 per cent.

The company reported its expense to income ratio was continuing to fall despite work on the proposed accounting franchise, CountPlus.

Lambert today reported settled loans to franchisees for the first four months had been $3.04 million compared to $1.8 million last financial year, and that loan numbers were expected to grow as franchisees merged and expanded to meet CountPlus’ consolidation requirements.

The company also announced a ‘Christmas’ dividend of 1 cent per share would be paid on December 15, 2005.