Cofunds had its first profitable year in 2008, when many companies in the financial sector reported huge losses.
A directors’ report says that despite “very difficult trading conditions” the platform’s profit before tax for 2008 was £4m, making it the first profitable year since the company was established in 2001. In 2007, the company made a loss of £12m.
Assets under management also exceeded the figure achieved in 2007 and grew to £14.6bn.
The report says: “The company expects that, with existing competitors and new market entrants, competition will remain strong.
“Consistent with the broader economic environment, market conditions deteriorated considerably in 2008 and this has continued in to 2009. However the company continues to grow both in terms of platform facilities and new asset acquisition.”
Brett Williams, chief executive officer, attributed Cofunds’ growth to high levels of new business and strength on the institutional side. He also hints that 2009 may end with a re-shaped platform industry.
“I believe we will see smaller niche players continue to struggle to gain traction or sustain the investment required to be competitive. We will also start to see insurer-owned platforms struggle as parent companies squeeze investment capital and focus resources on core business areas, which may not always be the company’s platform.“