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Impairment costs contribute to £4.6m loss for Lighthouse

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Lighthouse has reported pre-tax losses of £4.6m for 2012, compared to £2.7m losses in 2011, as it set aside £3.9m in costs relating to its 2008 merger with Sumus Group.

The firm’s accounts, published last week, show Lighthouse incurred costs of £500,000 relating to its failed delisting from the Aim market, which led to the departure of chairman David Hickey in August.

The accounts show Lighthouse continues to set aside a £1.6m provision relating to Arch Cru advice and spent £1.4m during 2012 on RDR implementation costs.

Turnover fell from £60.4m to £55m, while cash reserves fell from £11m to £10.5m.

The business has seen adviser numbers fall from 600 at the end of 2011 to 550 now.

Lighthouse did not pay a dividend to shareholders during 2012, compared to a £345,000 payout at 27p per share in 2011.

Lighthouse chief executive Malcolm Streatfield says: “The impairment costs are a one-off payment relating to the merger with Sumus Group in 2008 and has no implications for the future performance of the business. We are also confident the provision we have made for any complaints is more than sufficient to cover any possible claims.”

Last week, Lighthouse announced it has signed a new affinity partnership to offer advice to the Union of Shop, Distributive and Allied Workers’s 400,000 members.

The firm has also taken on two loans this month, totalling £820,000, to provide support to its national arm, Lighthouse Financial Advice.

Jacksons Wealth Management managing director Pete Matthew says: “I think the network model has been dying for some time. You wonder how they will survive in a world with tighter margins and increased scrutiny of adviser fees. The future is in the small firm.”

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