Admin costs hit Jelf’s profit

Jelf posted a drop in pre-tax profit from £4.2m to £3.5m for the year to 30 September 2008 after administration costs surged by about £20m.

Alex Alway, Jelf’s chief executive, said the increased costs were the result of investments in “systems and people” to help the consolidator integrate new acquisitions.

Acquisitions boosted revenue by 59% to £63.1m, while earnings before interest, tax, depreciation and amortisation (Ebitda) increased from £7.2m to £10.1m.

As Insurance Times went to press, Jelf’s share price had risen about 9.4% to 70p after the preliminary results were announced.

The private equity backer 3iQPE said it was fully committed to Jelf, in which it owns a 27.9% stake worth £29.8m.

Its advisory partner 3i, which owns more than a 40% share in 3iQPE, is rumoured to be looking at reducing its £2bn debt burden by selling stakes in its small and medium-sized businesses.