Quilter, one of the largest advice firms in the UK, has cut its number of restricted advisers over the past year by 141 from 1,842 to 1,701, it revealed in its latest interim results out today.

More advisers are set to depart the firm during the remainder of 2021 which expects a return to growth in 2022.

The firm has been tackling poor adviser productivity and says it has “facilitated a number of departures” of restricted advisers.

The restructuring has helped improve productivity in its Financial Planning arm with Net Client Cash Flow (NCCF) per adviser up from £1.5m in 2020 to £2.2m this year.

The figures come as the firm said its revamped investment platform had performed strongly and boosted profits but it has set aside an additional £7m to cover potential pension transfer compensation costs at its acquired Lighthouse adviser division. 

Quilter said that a skilled persons review had found “some instances of further unsuitable DB to DC advice given by Lighthouse advisers beyond that relating to British Steel Pension Scheme transfers.” The review is expected to be concluded in the first half of 2022.

At the beginning of 2021 Quilter announced that Quilter Financial Planning (formerly Intrinsic) would shift its focus towards “adviser productivity.”

Some advisers have been encouraged to move from independent status to restricted advice status to help improve productivity, the firm revealed.

The firm is continuing to “reshape” its advice business and expects further falls in adviser numbers before a return to growth in adviser numbers in 2022.

Thanks to strong platform figures overall, the firm reported Net Client Cash Flow of £2.5bn, up 27% on the prior period (H1 2020: £1.1 billion).

Adjusted pre-tax profit increased 20% to £85m (H1 2020: £71m) of which £29m (H1 2020: £24m) was from the sale of Quilter International. 

The firm faced higher regulatory costs and levies during the last six month period.

Total Assets Under Management or Advice were up 7% to £126.6bn at 30 June 2021 (31 December 2020: £117.8 billion). 

CEO Paul Feeney said:  “I am pleased with our interim results which demonstrate strong growth in flows across our business, with a material improvement from our new platform following our final migration of clients and advisers in February. This improving momentum sets us up well to achieve our medium-term target of 6% net flows from 2022 onwards. With the sale of Quilter International, our results demonstrate good early progress on our more focused, UK-based strategic path and gives a taste of what we know our business can deliver in the future.

“As well as making important progress on our strategic initiatives, we also delivered robust financial results, with further operating efficiency improvements from our optimisation initiatives. We are ahead of where we planned to be at this stage and are on track to meet our operating margin targets of 25% in 2023 and 30% by 2025. With the platform at the core of our business, we are well placed to deliver faster growth and we look forward to updating the market on our plans at our Capital Markets Day on 3 November 2021.”