Underlying profit fell to A$74.2m (£45.7m, $57m) from A$134m while revenue fell 2% to A$457.4m in the six months to the end of December.
The company, which has assets under management of about A$110bn, said the fall in profits was largely the result of divestments in its financial advice business made during the reporting period, as it sought to reposition the company as a wealth manager.
“We are reshaping the business through selective divestments and acquisitions, strengthening our focus on our core wealth management business and positioning IOOF for further growth,” said managing director Christopher Kelaher in a statement.
Fund flows rise
The profit fall also came despite a sharp pick up in fund inflows following the big shake up of the Australian government’s rules on superannuation contributions, the country’s mandatory pension savings system.
IOOF saw net inflows of A$1.4bn, up 46% on the same period of 2015, including platform inflows of $401m, up 173% on previous period, and the sixteenth consecutive quarter of positive net inflows.
Advice inflows totalled A$865m, up 17% on the previous corresponding period, as the result of a strong performance by the wealth management division.
“Strong inflows in continuing tough market conditions, and regulatory uncertainty, are testament to the strength and resilience of the business,” Kelaher said.
Rival wealth manager AMP, which runs the country’s largest financial adviser network, recently posted a full year net loss after a big deterioration last year in its core life insurance and income protection business.
Adviser hiring spree
AMP said the losses has caused it to cut back its financial adviser numbers within the group.
However, IOOF’s Kelaher said he planned to keep the company’s adviser network steady at about 1,000.
Kelaher also told local media the company would poach a substantial number of advisers from “large institutions” in coming months.
“We’re running positive, counter to the experience already reported by competitors,” Kelaher said.
“We’re also forecasting an inflow of seasoned advisers who will bring their books in over the next six months. Some of these people are on gardening leave and coming from large institutions.”
