Information technology company, Praemium Limited (ASX: PPS) released its 2018 December quarter update today (15 January 2019) in which the company reported a record combined gross inflows of $768 million for the quarter. Following this news, the share price of the company increased by 2.837 percent as on 15 January 2019.
The Combined quarterly gross inflows of $768mn include Australian gross inflows of $585mn and International gross inflows of $183mn. Further, the company reported a record annual gross inflow of $2.8 billion which is 10 percent higher than the previous corresponding period.
As per the company’s CEO Mr. Michael Ohanessian, the management of the company is very pleased to report record inflows despite facing significant volatility in global markets, with the ASX300 down 9.2 percent and FTSE250 down 13.8 percent in the 2018 December quarter. He also informed that the company’s funds under administration (FUA) was $8.4 billion at the end of the year which is 14 percent higher as compared to the corresponding previous year.
During the December quarter, the company’s Asgard’s contract was extended beyond November 2019, for a further six years with a minimum period of 3 years, which is significant milestone for the company. Further, the company’s WealthCraft CRM and planning software clients increased from 24 to 36 in 2018.
During the 2018 December quarter, the company witnessed a record UK gross platform inflows of £97 million which was offset by lower flows into the Smartfund managed funds. UK clients increased by 34 percent in 2018 from 136 to 182.
While commenting the company’s trading performance Mr. Michael also told that in 2019 the company will reach a significant milestone with the release of its signature development program – a next-generation Unified Managed Accounts (UMA) solution, through a modern digital portal. The company’s custodial platform will entail both SMA and IMA (Individually Managed Account) capability in a single structure. Combined with the non-custodial solution, Virtual Managed Account (VMA), the platform will deliver the ultimate Unified Managed Accounts (UMA) experience.
He further informed that due to the release in early February, the company’s new integrated Managed Accounts platform includes simple and consolidated reporting of all investment assets. The platform will also include broad investment choice with ease and flexibility to make changes.
There has been a marked shift in adviser intentions with more than two-thirds of advisers using or planning to use managed accounts in the near future and a high percentage of asset flows being directed to them. This shift is mainly due to the inherent investment, transparency and cost benefits for investors as well as for the business efficiency gains for advice businesses. The company’s integrated Managed Accounts platform will allow the company to serve a much broader part of the addressable platform market.
Meanwhile, in the last six months, the share price of the company decreased by 25.79 percent as on 14 January 2019 and is trading at a PE multiple of 201.43x. PPS’s shares traded at $0.725 with a market capitalization of circa $285.58 million as on 15 January 2019 (AEST 4:00 PM).
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