Profits rise at Begbies Traynor

ACCOUNTANCY group Begbies Traynor is continuing to see strong growth in its core insolvency division despite fewer business failures.

In the year to April 30, the group with offices across Yorkshire saw insolvency revenues rise by 13% to £58.9m – 85% of all income.

Begbies said activity levels in the second half were flat, reflecting the impact of Government support measures, but the firm has increased the average value of each case it handles.

Revenue in the firm’s tax arm declined by 10% to £6.3m which it put down to the poor market conditions. The division reined in losses of £1.1m at the half-year stage to £600,000 by the end of the year. This compared with a profit of £600,000 last time.

Overall revenue rose 11% to £69.1m while pre-tax profits were up 20% to £8.7m. An adjusted profit figure provided by the company, which takes into account amortisation, finance charges and exceptional costs, was up 6% to £10.4m.

Chairman Ric Traynor said: “Activity levels for the first two months of the new financial year are slightly ahead of last year and in line with our expectations.

“We expect to see the benefit of our organic and acquisitive investments in insolvency, as well as the restructuring of our non-insolvency businesses, mitigate the short term constraint of a subdued insolvency market.

Our expectations for the current financial year, therefore, remain unchanged.”

Mr Traynor stressed the group’s willingness to “consider selective acquisitions”. Since the year end it has bought the Manchester insolvency firm Tomlinsons and also taken on a seven-strong London-based tax team from Vantis.

The proposed final dividend is up by 12% to 1.9p giving a total for the year of 3.1p, up 11%.