Count Financial Limited is on track to achieve a 25 per cent jump in net profit for 2006-2007 and says it will hit an earnings target of $29 million.
Yesterday, Count upgraded its guidance from May when it announced expected annual earnings before interest and tax (EBIT) of $28-$29 million.
EBIT for 2006-2007 includes a $2.2 million non-cash cost of expensing company options.
Net profit after tax is expected to be $22.6 million, up 28 per cent on the previous year.
This represents annual earnings per share (EPS) growth of 25 per cent, which Count says meets its internal target.
Count informed shareholders that a staff bonus scheme will put a cap on EPS for the year.
Count pays annual bonuses to senior employees when its profit increases by 25 per cent or more.
“It is most unlikely that EPS target will exceed 25 per cent due to the structure of staff profit bonus arrangements,” it stated.
The dealer group is enjoying a strong share market performance, good market conditions and a strong year-end fuelled by the Government’s superannuation changes.
Count was unable to explain the recent strong performance of its share price.
“I’m at a loss to understand why the share price is so strong,” Count executive chairman Barry Lambert told InvestorDaily.
“Maybe we’ve been re-rated as a safe haven for super.”
Count also sought to reassure the market that its financial planning network had no known exposure to the collapsed property scheme Australian Capital Reserve (ACR).
“Like Westpoint and Fincorp, the products [and] projects of ACR have never been included on Count’s approved product list,” it stated.
Count is Australia’s third largest dealer group and is rapidly expanding its network.
It recently launched an acquisition business, Countplus, to buy equity stakes in accounting firms. It has also begun a mortgage broking operation, Finconnect.
Count’s share price was up 8 cents to $3.20 on Friday’s close.
