WH Ireland suffered a £1.8m loss in six-months as the wealth manager struggled with a fine from the Financial Conduct Authority and was not insulated against the troubled economic landscape.
In its interim results, ending 31 May, the wealth management firm revealed it had continued to see profits fall, reporting a pre-tax loss of £1.8m, declining more steeply from the £0.35m loss seen at the end of November.
On 31 May last year, however, the company had been in the black, reporting a profit of £0.59m.
WH Ireland had also seen its revenue drop to £11.9m at the end of May this year, from the £15.9m reported in May 2015.
Its full year results, released in February revealed the company had slipped into negative territory after being hit by a £1.2m fine from the Financial Conduct Authority following a review in 2013.
The loss also reflects one-off, non-trading costs, amounting to £600,000, which include legal and advisory fees and temporary employment costs within the company’s compliance department.
Tim Steel, chairman of the WH Ireland, said it had been a “challenging” and “difficult” period for the firm, particularly following the settlement with the FCA.
He also said the company’s wealth management arm was not insulated from the uncertainty in the UK markets.
Mr Steel blamed the fall in income from the corporate broking division on fears over Chinese growth, commodity price deflation, and the referendum, which he said had left the UK stockmarket “moribund”.
He said this reduced client trading activity has meant the firm has had lower levels of commission.
However, its half year results painted a more positive picture when it comes to discretionary assets under management, which jumped by almost a quarter to £949m, from £767m at the end of November.
It assets under management and administration also nudged up 6 per cent, hitting £2.7bn from £2.5bn over the same period.
Mr Steel said the group is currently undergoing “significant transformational change” at various levels, including the partnership with SEI Corporation to improve the company’s operational platform.
He also announced the company was looking to sell its property in Manchester to provide more liquidity and greater flexibility, as the company looks to develop its business.
katherine.denham@ft.com
