Consolidator AFH has paid out over £4m in earnout sums to its acquired firms this year, though admits the pace of deals has been slower than first thought.
In a trading update, AFH says earnouts have been paid at an average of above 90 per cent of the maximum price negotiated when acquisitions were agreed.
The company says while the number of deals secured this year has been slower than expectations, there remains a “strong pipeline of acquisition targets”.
AFH is expecting revenues to increase 15 per cent from £21m to £24m for the year to 31 October.
It is also forecasting assets under advice to hit over £2bn.
AFH chief executive Alan Hudson says: “I am encouraged by the strong progress we are continuing to see. AFH continues to be active in the market to acquire good quality IFAs but remains focused on ensuring shareholder value.
“The success and robustness of this policy is reflected in the high level of acquisitions meeting or approaching earnout targets and the strong cash flow generated by the business to finance these earnout liabilities.”
He adds: “The board will continue to execute its strategy of making selective acquisitions and increasing the breadth of AFH’s national footprint whilst providing a professional and cost-effective service to our clients, and believes that AFH remains well positioned to take advantage of opportunities as they arise.”