Jelf makes £9.8m loss

Broker Jelf announced plunged £9.8m into the red last year.

In 2008, the the West Country-based outfit made a profit of £2.4m.

Overall revenue increased 11% to £70.3m (£63.1m) largely driven by previous year strategic acquisitions. EBITDA (before exceptional costs) was £8.1m (£10.1m) and margins were 11% (16%).

Revenue for the insurance segment increased by 20% to £43.72m (£36.48m), but EBITDAE decreased by 16% to £5.17m (£6.18m). EBITDAE margin is 12% (17%). Operating loss is £1.30m (£2.68m profit).

The insurance business operates in 31 locations and represents 62% of the Group's revenue.

Cash and debts

Jelf said cash generated from operations was £8.7m (£10.5m) enabling the group to meet its deferred consideration payments from operating cash. It said deferred consideration payments will be substantially complete by 30 September 2010. Net debt declined £15.2m to £30.7m at 30th September 2009.

Jelf is in advanced discussions about fundraising to reduce net debt.

Purple partnership

Jelf said The Purple Partnership, the Group's network for independent brokers, exceeded its targets and continues to build its membership base. Revenue has increased by 78% to £0.3m in its second year of operation.

Looking forward

Alex Alway, group chief executive, said: "We look forward to the current year with the confidence instilled by an improved financial strength and a streamlined business, but we are cautious that this improvement remains fragile.

“The Group has removed a significant amount of cost through streamlining operations. The trading for the first quarter is slightly ahead of expectations, although whilst encouraged by this, we remain cautious for the current year.

“The recession in the UK has now probably ended, confidence has stabilised and markets have rebounded, but the outlook remains fragile.