Fast-tracking the exit of a number of business functions combined with weaker market conditions has prompted Wilson HTM to advise a predicted full year loss of between $4 million to $5 million.
In a statement to the market, the board and management of the listed financial services firm said the company's push to change its subsidiary, Next Financial, to a structured product approach would lead to a full year loss in the range of $7.5 million to $8 million.
"This reflects the concerted effort of management to transition the business toward co-branded structured product offerings and exit products where costs to clients has become prohibitive," the company said.
Wilson HTM's core business expects to deliver a profit before tax of around $4 million, with the company's flagship subsidiary, Pinnacle, also set to record a profit.
Funds under management (FUM) continues to growth with Wilson HTM recording FUM of $2.2 billion and Pinnacle $7.9 billion at 30 June respectively.
Despite the write-downs, the board said the company's position remains "sound", with no corporate debt, forecast cash of $17 million and net tangible assets of $58 million as at 30 June 2011.
Wilson HTM group managing director Steve Wilson said the significant write downs reflect the management team's "determination to address legacy costs" so the company can concentrate on its future.
"With no corporate debt, net tangible assets of $58 million and both Wilson HTM and Pinnacle profitable for the year, we are ready for [financial year 2012]," Wilson said.
"We're talking to new hires and are pleased at the calibre of people who share our view that the medium to long-term future for us, as a strong, independent Australian investment house focused on areas of speciality which outperform, is very good."
Last financial year, Wilson HTM said it would review Next Financial after the group's business unit incurred a significant one-off cost and a full year pre-tax accounting loss of more than $7 million.
