Link posts indifferent half but looks to future

Mike Taylor

Managing Editor/Publisher, Financial Newswire

27 February 2023

Major superannuation administrator, Link Group has posted a first-half decline in net profit after tax of $410.1 million, reflecting challenging conditions not least the continuing pattern of Australian superannuation fund mergers.

The half-year result reinforced the importance of superannuation administration mandate renewals and the status of its latest announcement about the renewal of the mandate from big retail industry fund, REST.

Link announced last week that rest had agreed in principle to extend their existing mandate by another five years. This would be on top of last year’s announcement that AustralianSuper had extended its mandate for an additional two years.

This was on top of earlier announcements regarding renewals or extensions with HESTA, AMIST, Prime Super and RBF.

The result also reinforced the value of Link’s move late last year to sell down 10% of its PEXA shareholding for $102 million and the pending sale of its troubled UK business, Link Fund Solutions to the Dublin-based Waystone Group.

The company’s half-year results released to the Australian Securities Exchange (ASX) on Friday saw revenue decline marginally to $592.2 million but operating EBITDA improve by 7.8% to $128.3 million.

The company declared a dividend of 4.5 cents per share, 80% franked.

Looking at its superannuation administration division which represented 45% of group revenue, the company said that operating EBITDA was up 18.5% to $76.9 million.

It said that recurring revenue for the half was underpinned by higher member numbers and indexation, offset by the impact of unclaimed superannuation money and previously announced client exits resulting from industry consolidation.