Praemium has reported a significant improvement for the 2012 financial year following its organisational restructure and cost-cutting program.
Despite earnings before interest, tax, depreciation and amortisation (EBITDA), excluding one-off restructuring costs, coming in at a loss of $1.6 million, the figure was a 68 per cent improvement on the $5.06 million loss in the 2011 financial year.
The company reported a net loss, including restructure costs, of $3.9 million, a 28 per cent improvement year-on-year.
Revenue and other income remained steady at $13.1 million, the company said in a statement to the Australian Securities Exchange.
“This past financial year we have seen a major step forward in the evolution of our company. We set ourselves the initial target of moving towards profitability by a combination of cost reduction and revenue enhancement,” Praemium chief executive Michael Ohanessian said in the statement.
“This progress was clearly evident by the second half of the financial year, with our financial results at breakeven EBITDA and a small EBIT loss.”
The company said that with the introduction of the Future of Financial Advice regulatory changes, separately managed accounts (SMA) would become increasingly important in the market.
“Our SMA technology, which is operated by BlackRock, will therefore become an important part of our growth strategy,” Ohanessian said.
In May, Ohanessian told InvestorDaily the company was focused on taking its SMA technology, in partnership with BlackRock in Australia, into the United Kingdom market.
But he would not be drawn on speculation Praemium was the frontrunner to purchase BlackRock Australia’s SMA business.
“We see a lot of synergies between what we do in Australia and what we do in the UK,” he said at the time.
“BlackRock is a partner of ours; we have been in partnership with them for seven years. We’re very comfortable with the growth of that SMA and our relationship with BlackRock is very good.”
In Australia, Praemium’s SMA technology is used by BlackRock Australia for CPS, which was launched in August 2005.
