For the six months ended 31 August 2014, the financial services company DATA KST:PSG Konsult Limited]posted a 26 per cent increase in revenue due to an improved performance in its asset management and wealth businesses.
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“PSG Wealth remains a key revenue driver and has maintained its upward revenue trend. It benefited from strong organic growth and positive client inflows, as well as generally favourable market conditions, resulting in the FTSE/JSE All Share Index increasing by 8 per cent since 28 February 2014 and by 21 per cent since 31 August 2013,” said the group in a statement.
Managed assets increased by 16 per cent to 98.6 billion rand due to a hike in management fees and brokerage income by 39 per cent and 19 per cent respectively.
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PSG Asset Management remained a high growth area due to strong client inflows from retail and institutional investors of 5.6 billion rand.
Total assets under management increased by 39 per cent to 21.9 billion rand while assets under administration rose by 24 per cent to 60.6 billion rand.
The group’s headline earnings increased by nine per cent with the asset management division set to exit all non-group related white label agreement in order to reduce operational and reputational risks.
“While reducing risk, we expect that this decision will have an immaterial impact on PSG Konsult’s profitability,” continued the statement.
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PSG Insure reported 29 per cent revenue growth with operating costs only increasing by four per cent. Higher weather related and commercial motor claims however impacted its subsidiary, Western Group Holdings
“Net income after tax prior to minorities increased by 28 per cent, but due to the corporate transaction concluded with Santam effective 19 September 2013, PSG Konsult’s shareholding in Western diluted from 90 per cent to 60 per cent. This had a 5.6 million rand adverse impact on the overall headline earnings contribution of PSG Insure.”
A gross interim dividend of four cents per share was declared for the period.
Going forward, the group said it will focus on enhancing top-line revenue growth at acceptable levels of risk in order to unlock more opportunities through a three-year strategic plan that will be implemented for each division.
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