SIPP and platform provider James Hay has seen revenues drop by £1.4m, in disappointing results for the first half of the year.

James Hay’s wealth management and Financial Planning arm Saunderson House had a better first half with revenue rising 2% to £16.2m and asssets under advice rising from £4.1bn to £4.9bn. The total number of clients rose by 8% to 2,056 with 144 new clients added.

Overall however, James Hay revenues dropped by 4%, equating to £1.4m, which was due to the ‘significant impact of the previously reported £3.3m reduction in interest revenue in James Hay’, according to the firm.

Operating profit dropped by 103%, with James Hay making a loss of £0.1m during the first half of the year. Total adjusted profit also dropped from £5.8m to £3.7m.

Platform revenue also dropped from just over £24m to just over £22.5m compared to 2016.

In more positive news for the company, assets under administration and advice increased by 19% in the last year to £29bn, with 3000 new clients using the firm, an increase of 50%.

The number of SIPPs rose from 51,875 in 2016 to 53,765 this year, an increase of 4%, while the number of new SIPPs rose as well from 2,053 to 3,075, an increase of 50% compared to last year.

John Cotter, chief executive of IFG Group plc, said: “Both businesses are delivering strong growth in clients and assets, reflecting the quality propositions that they offer our clients, and our ability to compete successfully in our chosen markets.

“Whilst short-term financial performance is being impacted by the low interest rate environment, restructuring costs and the resolution of legacy issues, we expect a much improved second half underlying performance, particularly in James Hay as the effects of repricing and restructuring start to bear fruit.

“We are confident that both businesses are on a strong growth trajectory and that the underlying performance will translate into a much improved financial performance in 2018.”