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LONDON (Alliance News) - Frenkel Topping Group PLC, which provides financial advice on the investment of personal injury damages and clinical negligence awards, Monday reported a fall in first-half pretax profit year-on-year, as a drive to grow assets under management by increasing the number of fee-earning staff it employes put pressure on margins.
Pretax profit amounted to GBP568,206 in the six months ended June 30, compared with GBP652,745 in the corresponding period the prior year, even as revenue increased by 9.0% to GBP2.9 million, with assets under management rising to GBP640 million at the end of June from GBP584 million at the same stage the prior year.
Frenkel Topping increased its interim dividend by 0.02 pence per share to 0.19p per share.
Direct staff costs rose by one-third to GBP1.1 million as a result of the company hiring more fee-earning consultants, putting pressure on margins and hurting pretax profit with a 4.0% increase in administrative expenses to GBP1.2 million. Fee-earnings consultants increased by 6 to 15 during the first half of the financial year.
Chairman David Southworth said the first half was "pivotal" for the company, as it looks to generate growth in operating profit, assets under management, and cash from 2016 onwards.
"We took the decision to build on traditionally consistent growth, which has been underpinned by 99% client retention for our investment management services. We are delighted by the calibre of fee earners we have added to our growing regional footprint and are well placed to further grow our reach," Southworth said in a statement.
"We are focused on further developing our core market expertise and also see scope to provide asset protection services to a growing number of other potential markets. We will continue to explore opportunities that will enable us to grow our assets under management as we build on our strong foundations for accelerated growth," the chairman added.
Frenkel Topping shares were down by 2.5% at 38.50p on Monday morning in London.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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