IFA network Financial Ltd has reported profits of less than half those of the previous year due to escalating administrative expenses and charges from the Financial Services Compensation Scheme, despite pulling in almost £1m more revenue year on year.
This year Financial’s profit before tax for the year ending 31 March 2012 was £164,691, down from £340,901 for the previous year. The largest increase in cost was to administrative expenses, which grew to £2.7m from £2.2m.
Although payments to the FSCS took £66,853 off the company’s bottom line, this figure is significantly lower than the £110,466 paid to the regulator last year.
A statement from the company within the results says: “The difficult trading conditions continued in 2011 and the company underachieved its sales targets resulting in a fall in profitability.
“The company made a profit for the year albeit at a lower level than the previous year.
“The business plan has been revisited and a further price increase has been communicated to members which should show the company returning to previous profitability levels.”