Half Year Result Positions Finzsoft for Record Year Profit

Press Release – Finzsoft

Half Year Result Positions Finzsoft for Record Full Year Profit

Image for publication: Finzsoft Managing Director Andrew Holliday: “Based on the current contracted revenue and pipeline opportunities for the year ending 31 March 2015, we will materially exceed our previous profit guidance of four times last year’s profit result”

Hi-res images for publication are available for download here

VIDEO: Watch Cyrus Daruwala, Managing Director IDC Financial Insight Asia Pacific explains why FinTech is a hot technology sector and how Finzsoft was ahead of the game.

VIDEO: Watch Finzsoft’s Managing Director Andrew Holliday talk about the future for Finzsoft.

28 November 2014 – Auckland: The Directors of Finzsoft Solutions Limited (NZX:FIN) are pleased to report on the Group’s performance for the six months ended 30 September 2014.
Finzsoft Group reports a net profit after tax of $2.023 million on revenue of $7.865 million. This half year result compares to a reported small loss after tax of $(0.063 million) and sales of $4.199 million for the same period of the prior year.

The half year result reflects the acquisition of Sush Mobile effective 28 August 2014, and includes the consolidated accounts of both businesses, reflecting one month revenue from the Sush operations. On a like for like basis, excluding any net profit after tax or revenue from Sush Mobile, Finzsoft Group reports a net profit after tax of $1.981 million on revenue of $7.603 million. As above, this compares to a reported small loss after tax of $(0.063 million) and sales of $4.199 million for the same period of the prior year.

Finzsoft Managing Director Andrew Holliday said: “Based on the current contracted revenue and pipeline opportunities for the year ending 31 March 2015, we will materially exceed our previous profit guidance of four times last year’s profit result.”

In light of the excellent first half financial performance, as well as the expected full year financial results for the year ending 31 March 2015, the Board expect to announce that Finzsoft will pay an interim dividend. The Board are meeting in early December to consider this matter and the decision on the interim dividend will be announced after that meeting.

Continuation of record year performance

Finzsoft Managing Director Andrew Holliday said: “As signalled by the Board, FY13 and FY14 have been turnaround years for Finzsoft with the new majority shareholder, Board and management refocussing the business and securing the Company’s largest work orders to date. Sales efforts in the previous periods have delivered a strong order book, and the continued focus on efficiency and on-time, on budget delivery to customers has resulted in profitable growth for Finzsoft, and we are on track to deliver a third year of record growth.

“Key highlights for the period include the continued expansion of our Australian operations, the acquisition of Sush Mobile to expand our product offering, and a new management team and structure in place to identify and optimise ongoing gains across our operations.”

Strategic Initiatives

As part of Finzsoft’s planned approach to build next generation capabilities and transform how Finzsoft’s customers approach core banking refreshes and upgrades, the Company successfully acquired and integrated Sush Mobile into its team and signed a five-year cloud agreement with IBM. “An increased focus by banking and finance customers on digital, mobility, online banking and granular customer data means Finzsoft customers want greater flexibility and more personalised and integrated solutions,” said Andrew Holliday.

Sush Mobile develops end-to-end mobile solutions, specialising in apps for Android, iOS, and Windows Phone, for businesses primarily in the enterprise space. In the past six months, Sush Mobile has been acknowledged for its innovations and growth being named the ninth fastest-growing company in New Zealand in the 2014 Deloitte Fast 50 and just one of 12 New Zealand companies to be ranked in the top 100 of the 2014 index of the Deloitte Asia Pacific Technology Fast 500. The Kiwibank Home Hunter app, co-developed by Sush Mobile, was named a winner of the Innovation in Financial & Professional Services Awards at the recent NZ Innovators Awards.

Andrew Holliday said: “Sush Mobile’s innovations, coupled with the company’s next generation knowledge and customer support tools, will help Finzsoft and its customers meet the competitive challenges that lie ahead. As a Group, Finzsoft and Sush Mobile will provide ‘mBank’ solutions to respond to key disruptive trends in banking – O2O (online to offline), IoT (Internet of Things) and customer centricity.”

In September, Finzsoft signed an agreement with IBM to move Finzsoft’s core and vertical banking application to the IBM cloud. This move will enable Finzsoft to offer solutions-as-a-service across the Asia Pacific Region and allow the Company to be more responsive and more agile.

Under the agreement, Finzsoft will leverage IBM Cloud Managed Infrastructure Services for New Zealand, as well as infrastructure from SoftLayer, an IBM company, enabling Finzsoft to take advantage of IBM’s global network of enterprise-grade data centres to support future expansion.

Management and Board appointments

In order to position the Company for future growth, two key executive appointments have been made during the period adding senior IT and banking leadership to the Finzsoft team. Hugh McKellar joined the Company as Chief Operations Officer, and Paul Doig, who comes from an international corporate and commercial banking background, has returned to New Zealand from HSBC in Singapore to be Finzsoft’s Sales Director.

Finzsoft was also pleased to welcome Westpac Banking Corporation General Manager Service Delivery Infrastructure, Gary Sim, to the Finzsoft Board. “Attracting a Director of Gary Sim’s calibre underscores the quality of Finzsoft’s products and service and the company’s current momentum and growth path,” said Andrew Holliday.

“Finzsoft is well-placed to leverage its world leading capabilities for sustained growth in Australasia and internationally, and I relish the opportunity to apply my experience and passion around leading technology for business transformation,” said Mr Sim.

Investment and Product development

Positive product feedback and increased appetite for new modules and services has seen the sale of Finzsoft’s next generation Business Origination, tablet app Seal the Deal and Mobile Banking modules to New Zealand and Australian customers.

The Company’s focus remains on delivering tools and platforms that drive efficiencies into traditional banking operations and practices and enable our clients to be at the forefront of mobile solutions for their staff and customers.

Markets

FY14 has seen significant growth out of the Australian market with continued substantial work orders from Westpac St. George Bank.

Andrew Holliday says: “St George uses Finzsoft’s software and solutions across its vehicle and equipment finance businesses in Australia. Since St George, a division of Westpac Banking Corporation, acquired CFAL from Lloyds Banking Group Australia last year, Finzsoft has secured multiple work orders to integrate CFAL’s portfolios into St George.

With 59% of our revenue now coming out of Australia we have diversified our income across Australasia. Finzsoft continues to be a significant provider of financial technology services in the New Zealand finance sector, delivering next generation mobile banking solutions to existing Sovereign clients, including the Nelson Building Society and Police and Families Credit Union. In addition to our mobile banking module, our Seal the Deal app allows our customers to be one step closer to paperless banking.”

Capital Structure

As previously announced, Finzsoft has engaged PWC to assist with a strategic review of its capital and ownership structure. The review is considering a range of initiatives to improve the capital structure and share trading liquidity to more appropriately reflect current and future market opportunities, the Company’s investment in R&D over 25 years and the value of its IP. The Board has the full support of the Company’s majority shareholder to execute these initiatives.

Outlook

The Board and Asean Management will continue to focus on known revenue opportunities in Australia, New Zealand and tightly manage costs.

Finzsoft Chairman Brent Impey said: “IDC Financial Insights is tracking external spend on third party financial technology providers at $300 billion globally. As a financial technology company Finzsoft is positioned to capitalise on the growing Fintech spend with its excellent track record of delivery to banking and finance customers in Australia and New Zealand, combined with the broader market opportunities from its partnership with Sush Mobile and relationship with IBM.”

“The Board is absolutely delighted with the outstanding performance by the Company over the period, in particular, the work done by the Finzsoft team on securing and successfully delivering on the work orders for St George Bank. We remain committed as a Board and Management to investing in our people, products and services and delivering continued profitable growth.”

ENDS

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