Personal Touch Financial Services has reported a rise in pre-tax profits for the year 2014.
Pre-tax profits rose to £483,176 on a turnover of £46.6 million. The company also saw a major reduction in the provisions for complaints (down 46%) and commission clawback (down 30%).
The network also became the first in the industry to introduce member fees directly linked to quality-based criteria, allowing over 80% of members to pay reduced fees in 2015. It claimed the strategy of safe profit also enabled the network to reduce the costs of PI insurance for members by £1/4 million.
Last year, the board was restructured. Max Wright, after three years as CEO, moved to a non-executive role and Jane Cross, formerly finance and IT director, was promoted to CEO.
Cross said: These results continue to show the effectiveness of our quality-based strategy, achieving a safe level of profit from a company with robust financial strength, now entering its 21st year in business – significant and important because ‘safe profit’ is profit that will still be within the business in the long term.
“For the last three years, we have been changing the business to ensure Personal Touch remains profitable and secure for the long term and this year’s results clearly reflect this work. A fundamental part of our strategy is de-risking the business to ensure we achieve ‘safe profit’. This core risk mitigation approach ensures that the profit achieved is sustainable. By supporting our members in delivering the very best financial advice to their customers, the volume of complaints and clawbacks has been substantially reduced. Our approach to safe profit has meant that we can support our members more. It has meant that we are able to continue to subsidise the cost of PI insurance and reduce membership costs.
“Following the ‘at retirement’ pension freedom reforms we believe the wealth landscape is changing dramatically. We are well positioned with a productive, stable community of wealth advisers who operate largely in hybrid businesses that will be able to offer consumers a range of wealth, mortgage and protection advice.”