Bollington swings to £685,000 loss as broker completes £2m overhaul post-MBO

Broker Bollington has completed a major £2m restructure of its operations that caused the broker’s results to swing to a £685,812 loss in 2013 from a £1.5m operating profit the previous year.

The broker reported turnover of £11.7m in 2013, a 1.3% dip on the previous year’ £11.9m, while administrative expenses of £11.8m in 2013 (£9.9m: 2012) pushed profits into the red.

But Bollington chief executive Paul Moors told Insurance Times the results were not a surprise amid the major restructure the business had undergone following its March 2013 management buy-out (MBO) from parent company Groupama.

Moors said: “The results were fully expected because following the restructure we have a really good business to develop our brand and what we want to do.

“It has been welcomed by the staff because it has allowed us to bring further clarity to the business.”

Following the MBO, Bollington relocated its motor trade, fleet and taxi insurance business, ChoiceQuote, from Liverpool and Glasgow into the larger office in Adlington.

The broker upgraded its website and call centre system and converted its five legacy systems into one. It also bought the Co-operative’s commercial vehicle book of business.

Moors said the changes would enable the business to grow organically by 5% this year and added that new hires in specialist lines would help the broker grow by a further 15% by the end of 2015.

Bollington has bolstered its care and charity and private clients divisions with new account managers and brokers. The broker has also taken on three additional risk management surveyors.

Around 20 new people have joined Bollington since the MBO 18 months ago.

Moors said growth will also come from the development of its motor trade and affinities businesses, as well as niche specialisms in recruitment and umbrella companies, microbreweries, technology and renewable energy.

Sister company Bollington Underwriting, an underwriting agent with delegated authority, reported a 10% increase in turnover to £2.4m (2012: £2.1m).

Operating loss improved from -£471,206 in 2012 to -£206,986 in 2013.

He said: “If you compare between 2012 and 2013 it has been down to restructuring costs. We are pretty well set to move forward with the business now.”