STM Group, the international financial services provider which owns SIPP firm Carey Pensions, has reported a drop in revenue and profit for the first six months of the year.

Revenues were £11.4m (2020 H1: £11.8m) and profits fell 10% to £0.9m (H1 2020: £1m).

Recurring revenue remained the main strength of the business for the first half of 2020, representing 88% of the group’s reported revenue.

Profit margin fell from 15% to 13% for the first half of 2020.

Earnings per share were 1.28p, in comparison to 1.33p in the first half of 2020.

However, the firm announced an interim dividend of 0.60p per share, a rise on the 0.55p per share dividend paid in the first half of 2020.

The firm has been undergoing a “simplification” exercise following a tough 18 months, it says.

In 2020 the firm reported a 48% drop in profit before taxation. Earnings per share at the pensions group fell from 5.73 pence in 2019 to 2.7 pence in 2020. However, revenues held steady at £24m (2019: £23.3m). 

STM delayed its 2020 results, originally due in April, following discussions with its auditors after the pivotal Adams v Carey court judgment.

STM acquired Carey’s SIPP business in 2019 for £400,000. At the time STM said in terms of the Carey court case, it had secured indemnities and the benefit of significant existing PI cover from the sellers of Carey.

In its half year results announcement the firm said that three of four IT projects the firm was working on have now gone live. The firm said this will improve operating margins.

The group said that its Berkeley Burke acquisition completed in August 2020 is now fully integrated and “delivering the profit that was anticipated."

The firm said that acquisitions were a “core pillar” of its growth strategy and it expects to make more in the future.

The firm has been undergoing a review of its structure which has included that sale of two businesses to allow the group to focus on its core activities.

Alan Kentish, CEO at STM, said: “The simplification of our overall group structure and our business lines remains a focus of the Plc board, and we are pleased to be able to state that we have now exited the trust and corporate services sector, having found good homes for both the Gibraltar and Jersey clients and colleagues. The Berkeley Burke acquisition of August last year is now fully integrated and delivering the profit that was anticipated.

“There continues to be a strong appetite for further acquisitions as a key pillar for revenue and profit growth, to sit alongside the organic growth opportunities. “

STM has partially returned to the office with a “hybrid” working model.