Clime Investment Management has reported a 52 per cent slide in group profit after tax, with just a 1 per cent increase in revenue for the full year to June 30.
The significant drop was attributable to "challenging equity markets", the listed financial services company said in its 2012 annual results announcement.
Revenue from ordinary activities stood at $5.48 million for the 2012 financial year compared to $5.47 million for the previous corresponding period.
The company generated an after-tax profit of $1.01 million for the year, representing a $1.11 million reduction on the previous year's profit of $2.12 million.
Other drivers for the reduced result include a significant decrease in net realised and unrealised gains on the group's listed investments and managed funds to a loss of $50,211. In contrast, the company recorded a gain of $438,054 for the 2011 financial year.
Management fees increased from $2 million to $2.9 million on higher funds under management (FUM).
As at 30 June 2012, the group's FUM was $293 million, compared to $231 million the previous year. The result is an increase of 27 per cent.
Company overheads increased to $4.89 million from $4.14 million in the prior period, due mainly to additional marketing costs of $220,000 and incentive payments of $100,000 to drive the company's FUM growth.
"The results of [Clime] for FY12 reflect the uncertain backdrop of world markets during the year, which has affected investor confidence and had an impact on the Australian share market," Clime chairman Mark Osborn said in a letter to shareholders.
In terms of future strategies, Osborn said the group planned to increase the value of the business for shareholders.
"The group aims to increase return on equity by continuing to outperform our peers in terms of investment returns, attracting additional FUM and MyClime clients, and prudent capital management," he said.
"The board and senior management have detailed plans in place to ensure we reach our goals."
