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Cavanagh counts cost of Ernst & Young deal

Cavanagh Group&#39s operating loss increased from £70,000 to more than £1m in the six months to April 30 as the firm started to integrate acquisition Ernst & Young Financial Management.

Cavanagh reported losses of £1.08m, around half of which it blames on the non-recurring costs of the £3m move for EYFM.

However, turnover more than doubled from £2.4m in the same period last year to £4.9m, which group chairman John Campbell says marks the start of Cavanagh&#39s “year of change”.

Cavanagh says now that the firm has identified areas of duplication between the two businesses, it expects to save about £1.5m annually. Levels of income have already increased on the same period in 2003, with adviser numbers up from 37 to 70.

Cavanagh admits there were redundancies after the EYFM deal, with overall staff numbers across the combined businesses down from 206 to 192. It has also closed its Guildford office and relocated its operations to London and Cuckfield, leaving the group with 10 premises in England and Scotland.

Despite the losses, Campbell says both businesses have “recovered” their former strengths, with turnover averaging £1.1m a month over the three months to May. He says with the geographical coverage offered by its offices, the group will be able to serve clients more thoroughly and with a broader offering.

He says: “From this robust base, we will continue to seek new business opportunities, provided they can be shown to add value for the benefit of our stakeholders.”


Worldwide buys Kingsmead IFA and sets out its plan to move into top 50

Cornwall IFA Worldwide Financial Planning has bought Kingsmead IFA in a deal that brings the number of its offices to seven. The acquisition will add £0.5m turnover to Worldwide which says it is on course to achieve its £3m turnover target by the end sof the year. Kingsmead&#39s six RIs bring the total number of […]

Insurance broker buys IFA firm

Manchester IFA Carpenter Rees Jackson has been bought by insurance broker Community Broking Group for £720,000. CRJ, which advises high-net-worth individuals and corporate clients, had a turn-over of £587,000 in the year to November 2003.

Lawyer warns on bypassing FOS

Private investors who ignore the Financial Ombudsman Service and go straight to court may have to pay their own costs even if they win, warns law firm Reynolds Porter Chamberlain.

Assureweb offers free training

Assureweb is offering free technology training to intermediaries and support staff to demonstrate the benefits of placing new business online and showing the advantages to their business available to them through technology. The service is open to all firms, no matter the size and can train a customer&#39s management team, advisers and administration staff. The […]

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England vs Australia: pensions

Well, the cricket season is here, and England and Australia are stepping up to the wicket. Although we compete with each other in the sporting world, when it comes to pensions, Australia’s pension programme is held up as a model for our auto-enrolment initiative. Auto-enrolment was introduced because people weren’t saving enough into their pensions, and it is still early days but signs are positive. However, in Australia, saving into a pension is compulsory, and in fact employers are the ones who have to pay in. Employees in Australia can make additional contributions into their pensions, but they don’t have to. Should the onus be on the employer or employee to save? Well in the UK we think it’s both, but to get ‘adequate’ savings for retirement it’s the employee who has to pay more in.


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