Year of rapid expansion slashes profits at Frenkel Topping

Frenkel Topping, the asset management and financial advisory firm, saw its pre-tax profit slip by 18% last year in what became a period of rapid growth.

The Manchester-headquartered firm’s profit before tax fell from £1.57m to £1.29m in the 12 months to December 31, during which time it expanded across the UK with new offices in Leeds, London, Birmingham, Cardiff and Bristol.

The company’s operating profit was also down during the period, falling by 14% to £1.5m, while revenue rose by 11% to £6.31m.

Frenkel Topping has partly attributed the fall in profits to the expense of the new office openings and also the acquisition of FC Fund Managers Limited, which it snapped up at the end of August for £4.4m in shares.

Company chairman David Southworth said: “Having recruited carefully and managed the expansion of our regional representation we are extremely well placed to increase operating profitability.

“Receipt of FCA approval will enable us to put our new strategy in place and to migrate our assets to the new model and to target a larger addressable market looking for a capital-preserving investment strategy.”

He added: “We are extremely excited by the prospects for the business and look forward to updating the market with further developments in due course.”

Looking ahead, Frenkel Topping’s board said it believes the firm is in a “very strong position” to significantly improve its future profitability, with forecasts suggesting a doubling of its operating profitability by December 31 2017.