Profits at Paradigm Partners fell 25 per cent in the run-up to the sale of adviser network Paradigm Financial Advisers to Caerus Capital Group.
Its results for the year to the end of April 2013, published on Companies House today, show profits went from £2m to £1.5m.
The business includes support services firm Paradigm, corporate wrap Amber, JargonFree and investment management business Tatton.
In the year to April 2013 turnover increased 11 per cent from £7.7m to £8.6m. Administrative expenses rose from 23 per cent £5.68m to £7m.
Total members’ pay increased 62 per cent from £825,198 to £1.34m.
In October Paradigm sold Paradigm Financial Advisers to Caerus for an undisclosed sum. Paradigm Financial Advisers made a £1.17m loss in its last financial year.
As part of the deal Paradigm wrote off £600,000 in impaired debt.
Paradigm says it expects to see the financial performance of the firm improve and also expects to reduce its £890,000 bank overdraft, though the overdraft facility was renewed in February.
Paradigm set aside £496,000 to cover “known liabilities” at the beginning of the financial year. Of this, £184,000 was paid following a review of the sales processes of Paradigm Financial Advisers. Paradigm says the amounts were covered by professional indemnity insurance and policy excesses “usually recovered from the appointed representative responsible for the individual case.”
In total, Paradigm paid out £213,000 in the year to April 2013, though did not disclose what this related to. A further £130,000 was set aside as at 30 April 2013.