Divestment of international arm paid off: Praemium

Oksana Patron

28 February 2023

Praemium has announced that a divestment of its international business, which was completed in June last year, has paid off and reported statutory net profit after tax (NPAT) at $9.1 million for the half year ending in December, 2022.

In the announcement made to the Australian Securities Exchange (ASX), the firm said a combination of strong net inflows of $1 billion, up 35% on the half year in June 2022, positive equity market valuations and improved cash administration fee contribution provided ‘strong top line momentum’.

Praemium said its continuing business revenue was up 17% compared to a previous corresponding period and was augmented by disciplined cost constraint. However, costs were up 6%, compared to half year to 31 December, 2021, and stood at $24.1 million.

The growth of separately managed account (SMA) helped generate $670 million in net flows from an $8.1 billion base at 30 June, 2022.

The firm also paid a 5 cents per share fully franked special dividend in August last year.

“The 2023 financial half-year has seen key strategic decisions pay off with increased profitability and enhanced shareholder returns,” Praemium’s chief executive and executive director, Anthony Wamsteker, said commenting on the result.

“The result, derived from strong net funds flow, margin expansion and discipline on costs, has delivered a step change improvement in operating leverage. We are very grateful to our outstanding people for their ongoing effort and its positive impact.”

Following the divestment of its international arm, the firm said its sole focus would now remain on its continuing business which is an Australian segment.