The effects of a major transformation strategy are taking hold at Perpetual Limited, with the group on track, or ahead, in its development, chief executive and managing director Geoff Lloyd has said.
The group’s financial results, announced to the Australian Securities Exchange yesterday, report an underlying profit after tax for the six months to 31 December 2012 of $35.1 million, up 2 per cent on the prior corresponding period.
“Today’s results are pleasing because it shows we’ve been very focused and disciplined on executing that [transformation] plan,” Mr Lloyd told InvestorDaily.
He pointed to $31 million of annualised cost savings (on a before-tax basis) and said the group is well on track to deliver on its aim of $50 million per annum of permanent cost savings. This includes a reduction in full-time equivalent roles of 450.
“We’ve done what we said we’d do – the corporate trust is a simplified business and it’s growing, and the Perpetual investment team’s excellent underlying performance continues,” he said.
A new platform offering with Macquarie, announced in late 2011, will be launched by the end of the June quarter, with Mr Lloyd noting that this is “great timing” in light of improved market conditions.
“That will allow us to have greater productivity and to grow our client base, particularly with [Perpetual Private] Super Wrap which we launched in April, and [which] has already raised $80 million in funds under advice.”
Mr Lloyd said a key focus for the rest of 2013 would be improving on the increased institutional inflows, which had ticked up in the previous six months.
Continuing to improve Perpetual Private adviser productivity will also be a key focus, with the release of manual administration burden enabled through delivery of the Macquarie platform offering and re-weighting of client-to-adviser ratios, he said.
The next phase of the transformation project would include IT developments around the transition of Perpetual’s data centre and remaining infrastructure, and a continued reduction in its property footprint.
The group also reported its holdings of cash, cash equivalents and liquid investments increased from $192.8 million at the end of the 2012 financial year to $218.8 million, “primarily as a result of improved net cash inflows from operating activities and the proceeds from the sale of [Perpetual Lenders Mortgage Services]”.
