In the financial year to September the company saw turnover drop from £20.5m to £16.9m, blaming Brexit uncertainty for much of the decline, according to annual accounts published this week.
The company made a financial year profit of £3.5m the previous year but a downturn in turnover, along with exceptional costs of nearly £700,000, pushed it into the red last year.
The company admits the current trading year – 2019/20 – may also be tough but a shift towards lower risk business and workplace advice should boost longer term performance, it believes.
The annual report says: “The reduction in the company's cost base, following its withdrawal from higher risk areas of advice, will impact on trading performance in the early part of 2019-20 but will thereafter enable the company to concentrate resources in more profitable, lower risk, activities.”
Despite the poor results chief executive Jack McVitie remains positive.
He said: “We continue to seek growth and are employing human advisers and our proprietary technology in our efforts to extend access to advice. We are particularly excited by our newly trademarked Bionic Advice proposition and our personal finance app, launched just last month.
“We are continuing to invest in technology to develop efficient advice delivery and digital customer engagement. While there is industry wide interest in Robo Advice, we believe that by using technology to augment the human adviser, the customer relationship is likely to be more successful – engaging customers, while reducing the cost of advice delivery.
“We will continue to maintain multi-channel advice and guidance delivery – face to face, online, digital and workplace.”
He sees potential growth in workplace-based advice.
He said: “Our existing relationships with employers put us in a position to seek growth in this market.”
In September, at the end of the company’s financial year, after difficulties in finding “affordable professional indemnity insurance,” the company withdrew from the DB transfer advice market resulting in a number of redundancies.
The company’s annual accounts show it had to pay £80,000 in redundancy costs and £200,000 to settle an ‘employment dispute.’
The firm’s Retirement Adviser division, which suffered the redundancies, is now focused on guidance and communications exercises for trustees. The firm has recently been recruiting once more.