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Insurance inside super changes hit Link bottom line
Major publicly-listed superannuation administration provider, Link Group has reported a significant first half profit decline.
The company announced an 84% decline in statutory net profit after tax to $29 million in what Link managing director, John McMurtrie described as a “transitional year”.
The company acknowledged that its first half earnings had been impacted by regulatory change and historical client losses in its retirement and superannuation services (RSS) business.
It said those regulatory changes were mainly the Government’s Protecting Your Superannuation and Putting Members Interest First legislation.
The company’s investor presentation noted that it was looking to strong member growth in Australia and international opportunities whilst regulatory change, client exits and fund consolidation was likely to affect near term financial performance.
McMurtrie said he believed the company was making good progress on delivering on its strategic plan and that the medium to long term outlook remained strong.
“We have executed on a number of key strategic initiatives including the expansion of our BCM business through the acquisition of Pepper European Servicing (subject to regulatory approval) and our entry into the US$2.9 trillion ($4.42 trillion) UK pension market via our investment in Smart Pension. In addition, the future potential of PEXA as a growth pillar for Link Group is becoming evident, given its strong contribution to our first half results.
“Link Group’s business units also continue to display resilience and deliver sound underlying performance We remain committed to driving further efficiency in our existing operations, delivering on excellence in service for our clients and growth through new opportunities,” McMurtrie said.
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