Yellow Brick Road has reported a net loss of $0.7 million in the 2017-18 financial year, despite increased revenue and decreased operating costs.
In a statement on the ASX, Yellow Brick Road (YBR) executive chairman Mark Bouris said he was “disappointed YBR made a bottom line loss” but said this was indicative of the impact “APRA-induced regulation changes and the background of the royal commission” are having on the industry.
Despite the loss, YBR reported a $9.5 million increase in total revenue and a $0.5 million decrease in operating costs, with Mr Bouris adding that he is “particularly pleased” with the growth seen within the mortgage and wealth businesses’ revenue.
The statement said its wealth business had funds under management attributable to YBR of $1.05 billion.
“The fundamentals of the business are good. We have put in place the foundations for our mortgage and wealth businesses to grow strongly in coming years,” Mr Bouris said.
“A structural shift in the mortgage market means credit conditions imposed by banks have tightened. That’s impacted on the 2018 profit but it also provides opportunities in the future.”
Today’s announcement comes only a week after Mercantile OFM, helmed by corporate raider Sir Ron Brierly, made a takeover bid for the business.
Mr Bouris told ifa at the time that the offer made by Mercantile OFM “materially undervalues” YBR and that the takeover attempt was “opportunistic in its nature, timing and pricing”.
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