Fairpoint Group returns to profit

Debt advisor Fairpoint Group reported a first half profit compared to a loss the same half a year earlier helped by a strong recovery at its IVA services division and as it continued to diversify its income streams.

The group reported a pre-tax profit of £2.1m in the six months ended June 30th 2012 compared to a £2.1m loss the same period a year before.

Revenue for the period rose 19% to £14.1m after a £2m increase in financial services revenues, mostly from its claims management services after strong growth for PPI claims. Debt management revenues grew by 11% to £2.8m.

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At its IVA services division the group posted adjusted pre-tax profits of £1.4m versus a £700,000 loss previously following cost cuts and robust demand. IVA revenues were unchanged at £8.7m.

"Fairpoint has continued its strategy of growth through diversification with strong financial, operating and cash flow improvements during the first half of 2012. Early progress in the development of claims management services has been strong and additional products are under development to ensure continuing momentum in this area," the group said in a company statement.

"We are also well positioned to continue to play a leading role in the ongoing consolidation of the debt solutions market, as and when value-enhancing opportunities emerge to consolidate our market position and diversify our income streams."

Looking ahead to the second half of 2012 Fairpoint said it expects to continue the momentum seen in the first half.

An interim dividend of 1.95p has been declared, up 11% from 2011.

CJ