IFG pre-tax profits plunge 20% to €12m

DUBLIN-BASED financial services group IFG has reported a 20 per cent drop in pre-tax profits to €12 million for 2008 due to financial turmoil and the depreciation of sterling.

Revenues dropped €19.5 million to €109.3 million. A 16 per cent sterling depreciation contributed to the profit fall as about 80 per cent of the group’s earnings are in the currency. Adjusted operating profits declined 10 per cent to €20 million.

IFG has three broad businesses. Its trustee and corporate business administers assets held offshore in its five primary markets; Cyprus Ireland, Switzerland, the Isle of Man and Jersey. This unit accounted for 60 per cent of operating profits, or €12.2 million, an increase of 26 per cent. Acquisitions from 2007 and last year accounted for two thirds of the growth.

IFG also operates a financial services business in the UK that administers individual pension funds and, separately, provides pensions advice to financial advisers and the legal profession. This unit generated 34 per cent of group profits. The remaining unit is IFG’s Irish operation, including pensions provision and mortgage broking in prime and specialist markets.

The construction sector collapse last year resulted in a €900,000 loss for the property division compared with a profit of €5.2 million last year. IFG said it plans to cut costs at this unit.

Chief executive Mark Bourke said the Irish businesses which were transaction-related and commission-based had done very badly compared to its “time-based fee-charged business, such as those in the UK”.

IFG hopes to pay down its debt to less than €25 million by 2011 using cash flow.