£1.5m goodwill charge pushes Cobra into loss

Broking group Cobra made an after-tax loss of £1.9m in the year ended 31 March 2011 after taking a £1.5m goodwill impairment charge.

The company made a £192,530 profit in the 2009/2010 financial year.

Cobra attributed the £1.5m charge to its decision to sell its broking operations in Caterham and Alton to help pay down debt. The units were sold to ASG Risk Management Ltd, a subsidiary of Aston Scott Group plc for a total consideration of £8.2m.

“We believe that the disposals leave COBRA well placed to build on these results over the coming 12 months, as the organic growth plans, cost reductions and initiatives continue to bear fruit,” Cobra said in a statement.

Total borrowings had fallen to £15m in the 2010/2011 year (2009/2010: £16.1m). Finance costs fell slightly to £1.57m (2009/2010: £1.59m).

Despite the loss, Cobra’s total revenue increased 1.6% to £23m in 2010/2011 (2009/2010: £22.7m).

“Market conditions continue to be challenging, but our trading results illustrate that through the continued achievement of synergies from past acquisitions, Cobra has continued to achieve commission growth,” the company said.

Expenses increased 5.8% to 20.6m (2009/2010: £19.5m).