WH Ireland has reported its first half-year profit for five years despite the sharp fall in assets in March due to the Covid-19 pandemic.
The group announced profit on an adjusted basis for the six months ended 30 September of £0.5m. This compared with a £0.91m loss for the same period in 2019.
The firm’s half-year results, published on Monday, build on its annual results published in July which revealed the firm had posted its first quarterly profit in “a number of years.”
Wealth management revenue was down 10.8% at £6.15m for the six months to the end of September due to the reduction in market levels, but the division’s assets under management increased 13.8% during the period to £1.73bn. This excludes assets from its Isle of Man office which it offloaded to Stephen Lansdown’s wealth business Ravenscroft in June.
The proportion of total AUM managed on a discretionary basis rose to 60% at the end of September, up from 57.7% at the end of March. This comes as WH Ireland attempts to transfer its advisory clients to its discretionary model on the SEI (UK) platform.
It follows a restructuring of the group’s wealth management division including aggressive cost cutting measures, consolidating duplicate wealth management platforms and corporate broking trading systems, as well as the closure of non-performing offices.
Corporate and institutional broking saw revenue jump 61% to £6.22m at the end of September. It reported having 80 corporate clients at the end of September, up from 76 at the end of March and completed 32 transactions over the period, raising £103.86m, compared with £43.13m for the same period in 2019.
WH Ireland chief executive Phillip Wale (pictured) said: “I am pleased to be reporting the first half-year profit for WH Ireland for five years. Over the last six months, WH Ireland has seen the benefits of the significant restructuring we embarked on 18 months ago; fixed costs have reduced over that period, while revenue has remained broadly flat as we have simplified the business.”
Wale said the wealth management business had remained “operationally robust” despite the significant market falls in March, while the corporate and institutional business is “showing strong momentum”.
He added: “While the uncertainty of the impact of Covid-19 on businesses and the wider economy continues, it is challenging to predict future performance, nevertheless, I believe the momentum we have seen in the first half, alongside a robust capital and cash position, gives us a strong platform for the second half.”
WH Ireland chairman Phil Kelly said the firm’s aim over the next three years is to increase discretionary assets in the wealth management division to £3bn and to double revenues in the broking business.
He added: “With good progress evident in the first half, the Board looks forward to the remainder of the financial year with some confidence, albeit in what remain highly uncertain times. We do that knowing that the business has reduced its risk considerably, whilst demonstrating an ability to increase revenue in this challenging environment.”
