On December 18, 2018, Praemium Limited announced that they had renewed a major contractual arrangement with Asgard Capital Management Limited for providing portfolio administration services. From the last 11 years, Praemium has been providing portfolio administration to this major financial institution. Its current contract is going to expire in November 2019.
As per the renewed contract, the arrangement between the two parties is extended for up to a further 6 years, with a minimum period of 3-year. The extended agreement retains a minimum contract value of $3 million per year.
Praemium Limited (ASX:PPS) is in Software and Services industry. The company provides investment platforms, portfolio administration, financial planning tools for the wealth management industry. The company got listed in 2006. The company manages over 700 clients covering $110 billion in assets.
Quarterly Performance: On October 15, 2018, Praemium Limited provided its platform update for the September Quarter. The company has achieved Australian gross inflows of $466 million, which is the fifth highest on record. The international inflows total to $179 million with the fourth consecutive quarter above $100 million.
The company surpasses $8.5 billion FUA which is a 29% increase in FUA (Funds under administration) over the past 12 months, despite a decline in global equity markets during September month and outflows from the Smartfund range of funds.
The company was awarded the title of “International Platform of the year” at recently held International Adviser Global Financial Services Award in London.
The September 2018 quarter also includes several important milestones. They are:
- FUA into the Australian retail superannuation offering (SuperSMA) has surpassed $1 Billion for the first time with a 43% increase in FUA over the past 12 months
- There is a remarkable growth in pension schemes in the international business, which has almost doubled during the year to 666 schemes.
- The company has evolved Praemium’s leading SMA platform to a Unified Managed Account (UMA) platform with an integrated design that will support a variety of managed accounts services (SMA, IMA, and VMA).
- The company has developed an advance adviser dashboard which will provide a powerful digital experience for wealth managers while utilizing Praemium’s Managed Accounts platform.
FY18 Financial Performance: The company generated total revenue of $43.2 million in 2018, representing an upside of 22% over the $35.4 million recorded in the corresponding period in 2017. EBITDA for the year is $8.842 million, an increase of 40% over the $6.34 million recorded in the corresponding period in 2017. Profit after tax for the year stood at $1.42 million, representing an upside of 106% over the prior year which was $0.688 million.
On Balance Sheet front, Net Assets have increased by 19% to $20.3 million in FY18 over the $17.1 million in the corresponding period in 2017. The company ended the year with $12.12 million in cash over the $8.983 million in the corresponding period in 2017. The company is debt free.
Operating cash flow for the year stood at $5.412 million, representing an upside of 252% over the prior year which was $1.54 million.
In the last six months, the share price of the company has shown a negative return of 29.94 percent as on 17 December 2018 and 22 percent down over the past one month. Praemium Limited shares are trading at $0.610 with a market capitalization of $251.15 million as on 18 December 2018.
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