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Praemium earnings flat as inflows climb

By Sarah Kendell
 — 1 minute read

The listed managed accounts platform recorded over 100 per cent growth in inflows over the 2021 year, but the costs of its acquisition of rival Powerwrap weighed on its overall performance.

Announcing its full-year results on Monday, Praemium said net inflows to its platform over the 2021 financial year had been $3.8 billion, up 111 per cent from the previous year.

Platform funds under administration had also climbed 163 per cent to $23.4 billion, the group said.

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While revenue was up 37 per cent in Praemium’s Australian business to around $53 million for the year, earnings before interest, tax, depreciation and amortisation declined 2 per cent to 19 million, compared to $19.4 million for the 2020 year.

“This is from the transition of the Powerwrap cost base and some cost expansion to support growth and service across sales, marketing and operations,” the group said.

“EBITDA margins were 36 per cent of revenue, down from the prior year’s 50 per cent. These growth investments and scale benefits from Powerwrap synergies will drive improved earnings into FY22.”

“The 2021 financial year was an excellent year for Praemium. The highlights included the successful acquisition of Powerwrap and the outstanding growth achieved in each of our major operating segments,” Praemium chief executive Anthony Wamsteker said.

“Underlying EBITDA was very similar to last year in both the Australian and international segments. This result was achieved despite a significant increase in the expense base of the company.”

With Praemium having flagged it will sell off its international business after the completion of a strategic review earlier this year, Mr Wamsteker said the coming year would “produce some dramatic positive changes in our business”.

“I believe that the steps we are taking will build on a proud heritage and ensure that we are positioned to realise the potential of the business that is just starting to take advantage of the wonderful opportunity presented by the investment platform market segment,” he said.

 

Praemium earnings flat as inflows climb
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