Openwork’s annual accounts showed it made a pre-tax profit of £321,047 in 2012, against a £13.3m loss the previous year. Revenues rose by £10m to reach £179.5m.
However, the accounts also showed that adviser numbers shrank by 147, from 2,261 in 2011 to 2,114.
The company’s increased productivity and smaller membership indicated that the Retail Distribution Review (RDR), which introduced higher minimum qualifications, had created a better workforce, Openwork proposition and marketing director Philip Martin said.
He said: “We have managed to move from a loss to a profit with a slightly smaller adviser base, so that tells you that those that have remained are more productive, better quality advisers.
“We are big supporters of what’s happened with RDR, we are big supporters of the transparency and for a business like Openwork it’s helped us accelerate some of the changes that needed to be made to get us in a sustainable, profitable position.”
Martin said the business had seen a number of older advisers leave the industry as a result of the qualifications requirements. Others, he said, simply moved over to give mortgage and protection advice to avoid the rules.
Openwork’s profit was revised down substantially from its projections following the audit of the accounts. Figures released in February showed that the network expected to make a profit in the region of £600,000.
However, Martin said: “That’s very standard. When I made that announcement in February, that was for an unaudited number. As you go through an auditing process you have a debate with auditors about various line items and sometimes your final number will rise, sometimes it will fall but the material point here is that we are still in profit.
“While it sounds dramatic that profit halved you’ve got to put that in the context of the year before when we lost £13.3m. Frankly any number that was positive was quite a move away from where we were a year before.”
