Fortnum chief executive Neil Younger told ifa the group had a clear strategy to “develop a scalable, fully resourced, sustainable licensing model”, which was a long-term play for Fortnum.
“We knew that would require patience, as licensees have traditionally been loss-making,” Mr Younger said.
“Furthermore, Fortnum does not have any product subsidisation.”
The comments came as Fortnum’s financial statements filed with ASIC showed that, for the 2019 financial year, the group recorded a loss of $357,000 after tax, declining from a $136,000 profit after tax the year before.
The group’s revenue had declined by around $1.7 million from around $49 million in 2018 to $47.3 million in 2019, offsetting cuts of approximately $145,000 to administration expenses, $125,000 to employee benefit costs and $40,000 to legal expenses it made over the 2019 financial year.
However, Mr Younger said over the current year, Fortnum had “grown and welcomed a number of quality advice businesses”.
“This coincides with ongoing investment in our advice systems, processes and capability,” he said.
Mr Younger added that the group’s priority was “to build a long-term sustainable advice business”.
“This strategy is working, with our growth and investment being rewarded with profitable growth,” he said.
“This has positioned Fortnum strongly to continue delivering excellent service and support to our existing advice businesses while recruiting new practices.”
“Fortnum does not have any product subsidisation”. Don’t they have inhouse managed accounts?
The AGM will be interesting. Did Fortnum just raise capital AND pay significant bonuses?
Why didn’t they just not pay the bonuses? What a mess!
Advisers need to be very careful under a license that is nit economic , as there business can be seized by the creditors at any time.
nobody will ever make money from this gig while we are bound by this never ending stream of red tape
Is this why Fortnum just raised money? I wonder if they needed this new capital raise to stay solvent?