Wealth management firm IOOF Holdings intends to more than halve the number of platforms that it offers by December 2011, as it seeks to further simplify its business.
The group’s plans were revealed as part of its financial report yesterday, which showed record underlying profit after tax pre-amortisation of $47.1 million for the six months ended December 2009.
IOOF plans to have three platforms by December 2011, compared with eight currently.
The company will have seven platforms by June 2010. IOOF has already announced that it would terminate the Global One platform, which it gained through its purchase of Skandia Australia in March 2009.
IOOF managing director Chris Kelaher would not be drawn on which platforms would be kept or rationalised.
“I think at this stage it’s a step-by-step sort of structure. The landscape changes periodically. We’re looking at some further regulatory change potentially and therefore I don’t think it’s helpful to identify them,” Kelaher told InvestorDaily.
“What we’re saying is everyone understands the basic economic metric that one is better than many, because in the funds management industry the ultimate efficiency is fewer funds with larger aggregate balances – that’s the logic, but we’re not identifying specifically now.
“Once we’ve concluded [rationalising] successfully with Global One, which we should do shortly, we’ll review everything again.”
Kelaher attributed IOOF’s record interim results to synergies extracted from acquisitions, market movements and headline products returning to net flow positions.
IOOF successfully merged with Australian Wealth Management in 2009 and had achieved $17 million in annualised after-tax synergies as at 31 December, the profit report said.
The company remains on track to achieve $20 million in cost savings by 30 June 2010, it said.
