Pensions specialist IFG anticipates ‘meaningful growth’

Financial services group, IFG anticipates “meaningful growth” in group profitability in 2015 and has said it will adopt “a more progressive” approach to dividend payments to shareholders.

The Dublin-headquartered pensions specialist — which is now wholly focused on the UK market, following last year’s sale of its non-core Irish operations — yesterday reported an 8.2% fall in annual pre-tax profits, for 2014, to £4.6m (€6.24m); although group revenue marginally increased from £63.3m to £65.1m.

Operating profit slipped from £5.4m to £4.83m and basic earnings per share, from continuing operations, shrank from 4.18p to 1.11p.

IFG’s recent restructuring – which saw the sale of five business divisions – leaves its focus on the James Hay specialist pensions business and the independent financial advisory firm, Saunderson House; both in Britain.

“We are strongly positioned, with two profitable businesses in attractive markets and a strong liquid balance sheet to support further growth and investment. Based on our award-winning propositions to customers and the delivery of business efficiences, we expect 2015 to deliver meaningful growth in group profitability,” group CEO Paul McNamara said on the back of yesterday’s results.

A final dividend of 2.73p per share has been recommended by the group’s board, making a total dividend of 4.04p for the year. Group chairman John Gallagher said following last year’s restructuring, IFG’s board has agreed to adopt “a more progressive approach to dividends and will recommend dividends in sterling, in the functional currency of the group,” although shareholders can still elect to receive payments in euros.

On a combined basis, revenue from James Hay and Saunderson House grew by 6%, last year, to £61.2m. In truth, this was driven by the latter, which saw its revenues go from £20.7m to £24.5m and its profits grow from £4.76m to £5.36m; while James Hay’s revenue movement was flat at £36.7m and its operating profit slipped by almost 14% to £7.88m.

Management said that it is now in a position to further invest for growth in its core businesses, having significantly strengthened its balance sheet, with net cash growing from £17m to nearly £23m last year. It, also, hasn’t changed its stance regarding not having any plan to either move its headquarters to the UK or de-list its shares from the Irish Stock Exchange.

Mr Gallagher said that further investment will position its two core UK businesses as market leaders, while last year’s restructuring moves will help deliver medium and long-term growth to the group.

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