Insurance group Towergate continued to suffer a decline in its underlying profitability in the first half of the year but claimed its turnaround is “ahead of schedule”.

The broker, which has its headquarters in Maidstone, saw adjusted earnings before interest, taxes and other charges fall 16.9% to £40.3 million in the six months to the end of June.

It comes after a fall of 15.5% to £78.7 million in the whole of 2015 after it was rescued by its bondholders last year, who restructured its £1 billion debts following a loss of more than £720 million in 2014.

Income also continued to fall in the first half of the year, down 7% to £164.9 million, which it said was “broadly in line with expectations”.

This comes after a 10% decline to £184 million when it reported the same figures last year. Income fell 6.4% to £352.7 million through the whole of 2015.

The firm, which also has offices in Sevenoaks and Faversham, the latter under the Capital and County brand, cut its staff costs by 5.2% to £89 million.

It announced it is increasing its cost savings target to £36 million, up from £30 million in the first three months of the year, of which it said 80% has already been delivered or is underway.

In July, it sold its majority interest in Broker Network to Highbridge Principal Strategies, which it said had strengthened its cash position.

In the same month, it was fined £2.6 million by the Financial Conduct Authority for allowing a £12.6 million shortfall to appear in its client and insurer bank accounts.

Chief executive David Ross said: “Our turnaround is ahead of schedule as we continue to address our legacy issues and build on our unique platform as the last remaining independent broker with national clout.

“The business is coming together with an unwavering focus on execution. Our costs saving initiatives are ahead of target while in tandem we continue to reinvest in our systems and people.”

He added: “In a people business, the most important lead indicator is staff retention and recruitment.

“Across all segments, more people are choosing to stay at Towergate and to join us, resulting in increased customer satisfaction and retention, and helping us to build a better business.”