Finzsoft annual profit slumps 93% as Asian opportunities take longer than expected
Finzsoft Solutions [NZX: FIN], the financial service software developer majority owned by Singapore-listed Silverlake Axis Group, posted a 93% slump in profit as it took longer than expected to win opportunities in Asia, while ramping up spending on sales and marketing.
Net profit fell to $204,000, or 2.34c a share, in the 12 months ended March 31, from $2.7 million, or 31.94c , a year earlier, the Auckland-based company said in a statement. In March, the software developer warned profit would be "materially lower" than in 2015, and the company is in the process of switching its balance date to June 30 to align its results with its majority shareholder.
"As noted in our market update, we have seen a delay in contracts and slower-than-expected access to new business opportunities in Asian markets," chief executive Andrew Holliday said. "Although some markets continue to be challenging, we are proactively managing our cost base to ensure that performance remains in line with management expectations."
Finzsoft posted an 8.5% drop in annual revenue to $17.9 million, and while it trimmed spending on its biggest costs – development, servicing and other costs – to $10.3 million, sales and marketing expenses more than tripled to $2.5 million.
The board didn't declare a dividend, having paid 22.6c in the 2015 year.
The shares last traded at $2.25 and have dropped 20% so far this year.
The company today said customer CSG Finance NZ extended its licence and support agreements with Finzsoft, without quantifying the deal. It's also in negotiations to become First Credit Union's banking software and technology provider, having struck a deal to be preferred partner for the country's largest credit union's 62,000 members in March.
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