Praemium posts 53% drop in half-yearly net inflows

Oksana Patron

20 January 2023

Praemium has reported a 53% drop in its half-yearly net inflows, which fell to $1,016 million from $2,186 million, for the December 2022 half-year results.

The firm also confirmed that its separately managed accounts (SMA) half-yearly net inflows slipped 50% to $670 million while Powerwrap half-yearly net inflows stood at $346 million and were down 59%.

In the announcement made to the Australian Securities Exchange (ASX), Praemium said that the market movement for the half-year to 31 December 2022 represented approximately 2.2% of the value of platform FUA (funds under administration) as at 30 June 2022.

“Net platform inflows for the December 2022 half-year were augmented by $421 million in positive market movements. This was made up of positive $580 million for the quarter to 31 December 2022 and negative $159 million for the quarter to 30 September 2022,” the firm said.

“It also compares favourably to $528 million in positive market movement for the half-year to 31 December 2021.”

At the same time, total funds under administration (FUA) for the December 2022 half-year increased by 6% to $42.7 billion, followed by an 11% growth for the SMA segment (to $9 billion) and by a 5% growth for Powerwrap which saw its FUA go up to $12 billion.

Commenting about the quarter, Praemium’s chief executive, Anthony Wamsteker, said that investor sentiment had been subdued in the wake of three successive previous quarters of negative markets and high volatility.

“Nevertheless, the December quarter of the 2023 financial year has seen both Powerwrap and Praemium’s SMA scheme continue to generate positive net flows.

“The SMA is our cornerstone product and highest revenue earning service. It achieved rolling annual net inflows of $1.3 billion, including $225 million for the quarter. Its rolling annual net funds flow represents 16% of the starting FUA, an outstanding achievement.

“Powerwrap has returned to a reasonably consistent positive flows contribution. It demonstrates advisers continue to value the enhancements and integration implemented over the course of the prior financial year.”