Published 18 May 2006
Western Bay Finance Ltd (Jim Smylie) has leapt from a $22,000 half-year operating surplus to a pretax surplus exceeding $1 million for the March year. The profit included a one-off gain by the inclusion of the value of its bad-debt ledger for the first time.
That’s down from a pretax surplus of $2.2 million, after tax $1.97 million, on revenue of $19.8 million in 2005.
“Earlier in the year I predicted that many finance companies would report lower profits this year due to new international finance reporting standards, new consumer credit legislation and tougher market competition. We are seeing the fallout from this now as results are announced. As expected, Western Bay Finance, in these difficult trading conditions, is in profit,” Mr Smylie said.
He said many firms, including Western Bay Finance, had spent heavily to comply with the effects of the new reporting standards and the new consumer credit legislation.
Mr Smylie said the company also pruned its operations to improve profit margins, closing 5 branches, consolidating staff levels and introducing more stringent credit controls. The new credit control structure had already resulted in a lowering of the company’s provision for doubtful debts.
Attribution: Company release, story written by Bob Dey for this website.