Centrepoint Alliance is on track to achieve profit targets for 2012/13 despite reporting a $17.88 million net loss for the year to June 30, according to MD Tony Robinson.

While he concedes the loss is “not an acceptable outcome”, Mr Robinson says in a note to shareholders that it “does however largely reflect the impact of legacy issues created in the years leading up to and during the global financial crisis”.

Centrepoint had to pay $11 million of claims against advisers at its Professional Investment Services (PIS) business, and this is included in the 2011/12 result.

“We have provided for both the known claims and incurred but not reported claims, and we are reasonably confident this will be adequate for the future,” Mr Robinson says.

“We are also confident the changes to management, culture and compliance over the past two years have materially reduced the risk profile of the business and put the company in a significantly better position with regard to claims from advice now being provided.”

The result also includes $1.9 million of external professional fees incurred resolving the cases. Such charges should not be repeated in 2012/13, according to Centrepoint.

Although PIS is “still a work in progress”, Mr Robinson says new CEO Peter Walther is building a profitable business.

Centrepoint says all its business units are trading profitably.

Associated Advisory Practices, which aids planning businesses and authorised representatives, “enjoyed a sound start to the year” despite regulatory changes and difficult financial markets.

The platform and funds management operations “are performing soundly”, while the commercial insurance premium funding business is “the star financial performer”.

The planned sale of the Singapore business, conditional on regulatory approval, will allow Centrepoint to focus on core Australian activities, Mr Robinson says.

The group hopes to give shareholders a trading update at its AGM later this month.

“The management and board believe there is a tremendous opportunity to become a key mid-size financial services business,” Mr Robinson says.