CountPlus releases half-year financial update
23 Feb 2021
CountPlus Limited (ASX: CUP) today issued its Half-Year (1H21) financial update for the six months ending December 31, 2020. The Company has reported net profit attributable to shareholders for the period of $4.082M, a 65% increase on the same period to December end 2019.
Earnings (EBITA) of $6.176M, when excluding government (JobKeeper) assistance, improved by 21% on the same prior period.
The Company announced an interim dividend of 1.25 cents per share at 1H2021, consistent with the same period last year.
“These results represent a steady improvement, bolstered by disciplined financial controls, diligent operational process, and a focus on efficiencies in our core businesses,” said CountPlus CEO and Managing Director Matthew Rowe.
Underlying firm revenue increased by seven per cent during the period, with productivity improvement showing an eight per cent contribution to margin improvement on the same period last year.
Underlying EBITA from Firms was $7.434M, or an 11% increase on the same period last year, while earnings from Associate Firms under the CountPlus Owner, Driver-Partner model increased by 66% on the same period last year.
“We see opportunity ahead to invest in underlying earnings of core firms that generate revenue through the delivery of client-centric accounting and financial advice,” Mr Rowe said.
The Company managed six ‘tuck-in’ acquisitions throughout the six months to 31 December 2020. Mr Rowe commented that the build out of the Company’s Merger & Acquisition (M&A) capabilities and process, and the execution discipline of the M&A team, further signals the Company’s strategic growth intentions.
“The ability to ‘tuck-in’ client fee revenue purchased from smaller firms is a key opportunity that CountPlus is uniquely equipped to leverage in the current market dynamic,” he said.
The Company has identified other investment opportunities in core-related businesses or activities that support the inputs / outputs (downstream) of core, firm-related activities.
Count Financial – sustainable financial advice model
The Count Financial network, though purposely fewer in number today than when acquired by CountPlus on October 1, 2019, is delivering improved earnings and profitability, increasing its earnings to $1.601M (EBITA) during this this 1H21 period, a 74% increase on the prior corresponding period of $0.926M.
“The deliberate pivot to a “clean” economic model has created a logical home for quality financial advisers to join the Count Financial national network.
“A sustainable Count Financial value proposition and underlying economic model supports our goal of being the natural ‘clean’ licensee destination for quality financial advisers. The business is demonstrating its competitive strengths within a challenging operating environment, with positive signals for growth,” Mr Rowe concluded.
Further highlights for Count Financial during this period included:
- An increase in gross business earnings per adviser by 38% since the acquisition of Count Financial on 1 October 2019.
- A halving of the time taken to produce advice documents, compared with the prior 12 months.
- A 73% average increase in advice document production per Count Financial adviser.
In discussing external challenges during the six months to end December 2020, Mr Rowe said CountPlus had capacity to act and confront the unforeseen stresses of the global COVID-19 pandemic and flow-on domestic economic challenges.
“A dominant theme for this reporting period is an ongoing caution concerning the impact of the global coronavirus pandemic, balanced with considered optimism,” he said.
“The CountPlus and Count Financial executive team has confidence that the Company will make considered and steady progress as we continue to align our people, partner firms, and new business acquisitions with the CountPlus vision of shared values, mutual success, and our strong sense of community,” Mr Rowe said.