Broker posted £2.7m loss in year to March 2013
Losses at broker Lorica grew last year after it hired new staff which it said would make it profitable in 2015.
Turnover increased 14% to £9.3m in the year to 31 March 2013 and the pre-tax loss grew from to £2.7m from £1.3m.
Lorica’s wage bill increased to £6.4m from £5m in the period, and full time staff numbers up to 109 from 88.
Managing director Matt Bray said the company would turn a profit in 2015.
By then, new hires will be out of the restrictive covenants which prevent brokers from approaching clients they worked with at their previous company.
“We invest in year one, they can do some organic growth, and get to understand the Lorica way, which is pretty different to where they’ve been.” Bray told Insurance Times. “They get into our sales machine. Over the next two or three years they start to make us decent money.
“And we’re not a business that accepts passengers. We set the bar high. This play is much bigger than people realise.”
Bray described Lorica’s model as “engaging talent and letting the talent do what they’re good at”. “Give them the tools and the toolbox to flourish - don’t tell them what colour socks to wear,” he said.
Bringing in expert teams helped all eight of Lorica’s branches to win new business, Bray added.
“For example we brought in a leisure team from JLT but all the local branches now have access to decent a market, decent wording, and trade association connections.”
Lorica’s balance sheet showed net liabilities of £204,737 (2012: net assets £278,692) including a £1.5m debt to parent company Primary Group. Primary Group confirmed it would support Lorica by not asking for the loan to be repaid until the broker was able to.