Their math is wrong however. They took the gross profit figure of $11.3m from page 3 of the HY19 report - which is ok. However, page 14 shows the detailed breakdown by division:
Gross revenue for the half year was: $52.999m (of which $6.2m was via grandfathered commissions) Commissions paid was: ($41.9m) Net revenue / Gross Profit: $11.3m
Without grandfathered commissions at 100% gross profit margin implies gross profit would decline from $11.3m to $5.1m.
This doesn't mean you have to double what you charge advisers. It simply means you have to replace $6.2m (or $12.4m for the full year), which you previously received via rebates to a new charge. As I posted earlier, this equates to $5k per Authorised Rep. Or have I got it wrong?
CAF Price at posting:
11.5¢ Sentiment: Buy Disclosure: Held
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