Evening folks, great synopsis AI and as a prospective investor like you have conducted my own research and still can’t seem to find a few answers, perhaps you can be so kind to assist?
I called a couple of IFA that I know and briefly discussed the concepts of outsourcing back office administration. (No mention of IAM) One adviser previously was licensed with AMP however recently joined my planner, he has 2 advisers and 4 paraplanners so his comfortable with keeping it in house but did say that all AFSL licensees/ dealer groups have the capability to offer advisers back office support, he mentioned AMP currently has that service and so does my planner so if he finds himself overwhelmed with too much work he will just use the services from his licensee because of the compliance issues dealing with external providers. I also spoke with another adviser who runs his own AFSL and has no immediate need to outsource services, so in summary both were quite unbiased towards this concept.
I noticed in the updated investor presentations, IAM have changed tactic and are moving away from the banks, I personally think this is a positive move despite want many here believe, the banks are not looking to outsource their financial planning back office, their core business is lending that’s the core component that they are trying to reduce costs particularly with the latest Basel iii requirements. CBA employees over 50,000 staff and yet only have 500 licensed advisers and they are currently in the process of reducing those numbers according to media reports in fact all banks are reducing their financial adviser’s numbers as wealth management contributes less than 10% to the bottom line yet carry huge compliance issues for the banks including poor sentiment. CBA’s recent financial accounts show that Wealth Management profits fell 34% to $249 million due to a sharp fall in life insurance yet the bank made a record half year profit of $4.9 billion, my understanding is that IAM don’t provide back office services for lending? Perhaps that’s another form of revenue that could consider?
IAM are claiming to achieve $40 mil NPBT by June 2019 yet have not provided any frame work on how that will be achieved, what is the marketing budget? What channels of marketing will they pursue? What is the profit margin? How much revenue do IAM need to generate to achieve $40 mil profit? How will they execute theis plan?
I regularly conduct business with senior executive from Clearview (ASX -CVW) which is listed dealer group/ licensee non-aligned with approx. 400 advisers and a MC of $1 billion which generated over $200 million last year and had a net profit of $3.9 million, so how much revenue will IAM need to generate per annum to achieve $40 million profit?
Also, Sentry signed an agreement with Iress (ASX-IRE) which is the world’s leading provider of software/ program to the financial planning industry, How will this effect IAM?
Sentry teams up with IRESS on back-office system
20 June 2016 Sentry Group has signed a deal for software company IRESS to provide its advisers with back-office services.The system, called Sentrak, will deliver functions including producing statements of advice (SOA), revenue management and flows, and streamlining administrative activities.It is based on IRESS’ financial planning software Xplan.Sentry Head of Business Solutions David Newman says the customised technology will help advisers grow their practices by maximising efficiency and the delivery of compliant advice.“It will strengthen Sentry’s position and reputation as an innovative, adviser-focused independent licensee,” he said.“In addition to improving the effectiveness of current practices, it will significantly improve the time taken by new advisers to integrate and get up to speed with our processes and practices.”Mr Newman says Sentrak will roll out gradually across the group’s adviser network from next month.“Testing has been extensive and the end-to-end solution goes far beyond compliance, production of an SOA and recording client details on a client resource management database,” he said.“From inception, our goal was a flexible technology platform that enhances adviser efficiency, simplification of workflows, revenue streams and business growth aspirations.
http://www.insurancenews.com.au/life-insurance/sentry-teams-up-with-iress-on-back-office-system
I have mentioned it previously that I found similar companies that offer back office
outsourcing, however JC Consulting Asia seem to be the leading firm with over 10 year's experience, apologies I couldn’t find any financials regrading this private company. I have attached several links for your perusal.
I sincerely hope IAM SH start to show some decorum and respect, I must agree with IAM’s management some of the behaviour by SH has been unpleasant and embarrassing, the shenanigans conducted by HC SH is unfounded speculation, no surprises that management will be less forthcoming with communication.
In conclusion, I continue to revert to my own personal circumstances, I have multiple business and they all carry excess fat as my objectives is to create opportunities for others not improve my bottom line.
The only time one will consider reducing expenses IMHO is when they are under financial stress, an example would be like many of you in your own personal life are like myself have children which all have iphones, ipads, mobile moderns, Foxtel & Optus, unlimited broadband and so on, I wouldn’t consider cutting any of these unless I was under financial stress, so how will IAM overcome this obstacle? I do like the concept but require more substantial information as the stock at the moment is a trader’s stock IMHO.
In summary if anybody has any contradictory evidence please post with facts, I don’t require any unsubstantiated comments and please refrain from personal attacks lets’ conduct an intelligent and mature discussion about IAM's prospects. Enjoy your weekend.
http://www.jcconsultingasia.com/index.html
https://www.centrepointalliance.com.au/contact-us/virtual-services/
http://www.dbaadvisory.com/
https://www.optimofinancial.com.au/
http://interprac.com.au/
http://wealthaxis.com.au/
http://www.plansplus.com.au/
http://tntadvisorsolutions.com.au/
https://www.clearview.com.au/
https://www.iress.com/au/
(20min delay)