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Openwork reports £13m swing into profit

Openwork has reported a swing into profit in 2012, reporting a profit before tax of £321,047, up from a £13.3m loss the previous year

In its annual results published today (2 October), Openwork reported that revenue was also up, reaching £179.5m in 2012 from £169.2m the year before.

However, adviser numbers fell by 147 from 2,261 to 2,114.

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Philip Martin, director of proposition and marketing at Openwork, attributed the outward trickle of advisers to the departure of 85-strong Blueprint which left the network in March 2012, and to general adviser attrition brought about by the regulatory change.

He said: “We have a slightly lower headcount but even with a change in headcount downwards we have managed to turn a loss into a small profit.

“The advisers that have remained post-RDR are in general better quality advisers.”

He added that the turn into profit was a “very big milestone” for the company.

In August, FTAdviser sister publication Financial Adviser reported that Openwork was one of many major platforms experiencing a net loss of advisers.

He said: “We don’t manage our business to maximise the number of advisers we have, we maximise the quality of advisers we have. We are managing to post a profit with fewer advisers.”

However, he added that if the Financial Conduct Authority does eventually raise the amount of capital advisory firms are required to hold, more directly authorised advisers would be driven to join networks.

The regulator recently pushed back the implementation date of the proposed hike in capital adequacy by two years.