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Durban - Purple Group on Monday said that it had spent a lot of money investing in a platform for future growth, making the company forsake profits in the short term and focus more on generating revenue in the long term.

Purple Group, as a derivatives trading and asset management business, incorporates four distinct client offerings:, EasyEquities, GT Private Broking and Emperor Asset Management.

The company has continued to invest in the EasyEquities investment platform and this has given rise to a number of new clients.

Chief executive Charles Savage said the group opened 43 710 accounts in the six months to end February, reflecting an increase of 122.4 percent since the first half 2016, with client assets totalling R912 million, up by 90.1 percent.

“Over the next six months we will be adding US shares to the platform and retirement wrappers, among other exciting enhancements that will no doubt continue to attract new clients and assets to the platform and bring us closer to our vision of democratising investing for all South Africans.

“In addition, we will continue to explore new partnerships and focus on delivering innovative solutions for our current partners,” said Savage.

Despite the good prospects for the future, the company reported a loss of R48.25 million as compared to a profit of R11.15 million while headline loss came in at 5.52 cents a share against headline earnings a share 1.29c in 2016.

Read also: Purple Group takes it on the chin after big IT investment

Revenue was down by 45.4 percent, primarily driven by lower client funds which were 10.7 percent down.

Chairperson Mark Barnes said he was disappointed about the results, but he said that he also remained hopeful that the company can make a turnaround in a short time.

Barnes said he remained convinced, however, that Purple Group was positioned for the changing, informed retail environment.

“I expect extraordinary growth over the next 18 months and I have no doubt that our significant investment in technology will pay off handsomely,” he said.

Emperor Asset Management came under pressure and has struggled to perform.

“The last 24 months have been extremely difficult for our momentum-based strategies, culminating in Emperor’s worst year of performance since the financial crisis in 2008.

“As a result, the funds experienced significant outflows over the last 12 months and did not generate performance fees,” Barnes said.

Operating expenses increased by 19.9 percent higher than the comparative period, but were 10.1 percent lower than the six months to end August 2016.

Despite the setback, the company said it was positive about its future prospects.

Purple Group traded 4.35 percent lower on the JSE to close at 44 cents.