OneVue Holdings released Half-yearly report: Share price nosedived

OVH

Financial Services company, OneVue Holdings Ltd (ASX: OVH) has published its half-year report for the period ending 31 December 2018.

Financial Performance:

There was a Strong revenue growth with high net cash position, the revenue from the continuing operations stood at $26.1m up by 31%. The revenue profile H1 FY 2018 TO H1 FY 2019 from continuing operations noted a Strong organic growth of $4.6m (+%) primarily driven by Fund Services, Managed Fund administration (31%) and Core Platform (35%). The Acquisitions delivered $4.9m of incremental revenue (KPMG Superannuation Member Administration $4.2m, No More Practice Education $0.7m). The Divestments provide a reduction of $3.3m (performance fees $0.6m, RE, SMSF Admin/IM business $2.7m).

The organic and acquired businesses contributed to EBITDA growth, the EBITDA profile H1 FY2018 to H1 FY 2019 from continuing operations was up by 8%. The underlying margin improvement was noted in both the businesses: Fund Services +12 bps, Core Platform +75bps.  Acquisitions contributed $0.7m (KPMG Super $0.9m, NMPE ($0.2m) –full six months). The divested business included high margin performance fees and results of IM/ RE and SMSF admin businesses (this does not include discontinued business). The adjusted NPATA from continuing operations was up by 35%.

Operating expenses noted an increased cost in higher investment period. The revenue profile H1 FY 2018 TO H1 FY 2019 from continuing operations noted Total costs increase of $5.9m, made up of: $3.7m from organic growth, $4.2m from acquisitions, less and $(1.8m) from divestments. The Cost increase of $3.7m supports organic revenue growth of $4.6m (Core Platform $2.0m with revenue growth of $2.5m, Fund services $1.6m with revenue growth of $2.1m).  Divestments provided a reduction in costs of $1.8m.

Proforma net cash of $45m (includes sale proceeds and $8.5m cash from continuing operations) to fund capital management and growth.  The $37m Sale proceeds expected on completion of Superannuation Trustee business in H2 FY19.

On 31 December 2018, the cash and cash equivalents of the company stood at $15.7 million.

Business performance

During the quarter, the company’s focus was on strong growth runways in Fund Services and Platform Services. The key growth drivers in Fund Services were the continuation of contracted transitions, securing new clients and integrating the KPMG Super acquisition.

On 20 December 2018, OneVue announced that it has entered into an agreement to sell the Superannuation Trustee Services business to Sargon Capital Pty Limited (Sargon). Completion is anticipated on or before 31 March 2019.

The company has an intention (following completion of the sale) to pay a 2.19 cents per share fully franked special dividend (utilising all available franking credits) and initiate a share buyback of up to 10% of capital.

Outlook:

Company’s transformation is complete and well placed for continuing growth. The company is creating shareholder value and has already completed strategic repositioning with final divestment being the Superannuation Trustee business. It will keep focusing on strong growth runways in Fund Services and Platform Services.

By the closure of the trading session, the stock of the company stood at A$0.550 (as at 26 February 2019), down by 1.786% from its previous close.


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