Boost driven mainly by organic growth

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RK Harrison made a profit before tax of £27.3m in the year to 30 June 2014, up 20% on the £22.7m it made the previous financial year.

The company, which is in the process of merging with fellow broking group Hyperion, also reported an increased profit margin of 27% (2012/2013: 26%) and a 13% rise in profit before tax, amortisation and exceptional items to £34m (2012/2013: £30m).

Turnover increased by 8% to £124.6m (2012/2013: £115.4m).

RKH said it was its fifteenth successive year of growth in turnover and underlying profit.

It added that the results were predominantly driven by organic growth and came despite a strengthening of sterling against the US dollar, which had a negative impact on the results.

RKH chief executive Paul Bridgwater said: “The strength of these results reflects the continued success of our employee ownership model, which attracts, retains and rewards the most entrepreneurial individuals for their contribution to the future growth of the firm, linking success for clients with our own.

“The merger with Hyperion enhances this approach with the added benefits of greater scale, expanded expertise and significant geographic reach. Crucially, Hyperion also share our commitment to an entrepreneurial culture and our approach to employee ownership.”

As well as growing, RKH also improved its debt position. The company moved to a net cash position of £9.2m in the year to 30 June 2014 from a net debt position of £3.6m the previous year.

Cash balances increased by 49% to £28.1m from £18.8m.

The company predicted in its 2012/2013 results that it its cash would exceed debt levels in the 2013/2014 year.