Restructuring costs and delayed acquisitions blamed for performance
Listed broker Culver Holdings has reported a loss of £617,000 for 2007.
The broker had predicted a loss making year when it announced its acquisitions of Lloyd's broker, LPH Pitman, and aviation specialist broker, AMS Corporate Risks in February.
But the company’s chairman Richard Read said delay in closing the acquisitions and the costs of restructuring the group had contributed to the loss.
Read said: “This is not what I had hoped for at the half year when I reported to shareholders that the outcome for the full year would depend crucially on the speed at which new producers begin to book income.
“I am disappointed to have to report that the speed was not what we had anticipated. This is in no small part due to significant challenges encountered, and later overcome, in closing the key acquisitions to give the Group access to the Lloyd's market. The delay in concluding these transactions coupled with the costs of restructuring the Group for its future have weighed heavily on these results.”
The broking group reported that its two operating segments were profitable in the year.
Insurance broking made a profit before taxation of £383,000, and employee benefits made a profit of £12,000. The comparative figures for 2006 are £267,000 and £55,000 respectively.
“Unallocated costs, on the other hand, have increased significantly due mainly to the costs of reviewing the Group's structure. The board had anticipated that the new structure would come on stream at the beginning of the final quarter of 2007 but is only now beginning to show signs of starting to produce income,” said Read.