New credit agreement will be used to repay £18m in loan notes
Broking group Heath Lambert negotiated a new £24m banking facility with Santander in 2009, repayable over five years.
The agreement, which includes an £18m loan and a £6m revolving credit facility, will be used to repay its £18m of loan notes at a more advantageous rate, according to a spokesman for the company.
The news comes as the broker’s 2009 profit on ordinary activities after tax slumped 65% to £6.9m from the £19.9m it made in 2008. The difference was caused by lower revenues in 2009, exceptional costs relating to the Guernsey operation, and gains from the sale of its wholesale operations in 2008.
Turnover fell 14% to £92.6m from £107.4m in 2008, including discontinued operations, while interest receivable fell 77% to £800,000 from £3.5m. Turnover from Heath Lambert’s UK operations only, which make up the bulk of the firm’s business, fell 11% to £81.8m from £92.1m.
Discontinued business, which was not present in the 2009 figures, accounted for £8.1m of the 2008 turnover. Excluding the discontinued business, 2009’s turnover was 7% down on the previous year. Heath Lambert’s drop in profits comes despite a 15% reduction in total administrative expenses to £86.7m from £102.2m.
But the 2008 result had been boosted by a £7.4m profit on the disposal of discontinued operations, an 11% higher profit than 2009 on the disposal of fixed asset investments, and 33% higher income from fixed and current asset investments.
The firm made an adjusted broking profit on continuing operations of £14.2m in 2009, up from £13.7m in 2008. This includes the trading result of £11.1m, but adds back in one-off charges of £2.7m for redundancies, £900,000 in legacy run-off settlements and £300,000 of overseas entities’ winding-up costs.
