Listed financial services company Investorfirst has begun a strategic review to identify revenue-acceleration opportunities and ways to refine elements of the business.
The review was being conducted by an internal team led by company chairman Otto Buttula and deputy chairman Jason Entwistle, the company said in its half-year report. Preliminary results from the review are expected to be ready at the end of next month.
A mixture of major one-off financial costs contributed to Investorfirst reporting a net loss after tax of $7 million for the six months ending 31 December 2011, compared to a loss of $758,000 in the same period a year earlier.
Legal and redundancy costs associated with the wind-up of the financial services group's ATG business and streamlining of back-office broking operations were among key write-downs.
The firm announced a $1.5 million write-off for the ATG investment.
The company also attributed the drop in profit to set-up costs linked to the company's Melbourne stockbroking operations as well establishment costs for the group's investment platform, Hub24.
The costs for Hub24 related to the firm's transition, in June last year, from a managed discretionary account service to an investor directed portfolio service (IDPS). It also related to the company's development of its retail super product, online equities development and increased infrastructure spending.
The firm also experienced lower than expected revenue contributions from Hub24 due to slower transition of funds under advice as a result of the transition to an IDPS provider.
Uncertainty surrounding the federal government's Future of Financial Advice reforms, market conditions and delays in the group's retail super offering also contributed to the decrease.
Investorfirst also announced depreciation and amortisation expenses of $1.3 million, largely for priority-owned platforms.
"The forthcoming period is likely to yield a much improved financial performance, driven primarily by better stockbroking and equity capital market conditions, and ongoing and increasing contribution from Hub24, augmented by some business refinement," the company said.
"The board and management remain committed to both the investment platform and stockbroking businesses."
