In the midst of the financial gloom, financial services software provider Bravura has turned in a net profit after tax of $2.6 million, an increase of 66 per cent, in its half-yearly results.
In its report to the Australian Securities Exchange (ASX), the company recorded a positive balance sheet, disclosing total assets of $212.2 million and net shareholder funds of $90.6 million for the half-year period ending December 31, 2008.
However, the company also disclosed a “management adjusted” net profit after tax of $4.6 million, saying “management has concluded that the exclusion of certain items promote a more meaningful analysis of underlying performance on a comparative basis”, excluding items the company does not consider “to be within normal operating activities”.
In particular, the company excluded “corporate and advisory transaction fees” related to acquisition proposals for shares in Bravura and “other corporate affairs”. The other items to be excluded were “foreign exchange gains and losses on derivatives primarily associated with foreign exchange forward contracts entered into as part of acquisitions” and “unrealised foreign exchange gains and losses”.
The company reported half-year earnings before interest, taxes, depreciation and amortisation (EBITDA) of $11 million, reflecting an increase of 14 per cent, a figure that was also management adjusted. Bravura said the EBITDA margin was affected by “a number of non-recurring items”, which included restructuring costs.
The results showed revenue growth of 9 per cent and positive net operating cash flow of $13 million.
However, there was also an increase in the company’s net debt by $10.1 million, which Bravura attributed to “final and initial acquisition payments”. The company said it remains within its banking covenants, and its current funding facility remained at $65 million as at the end of December 2008, with net debt sitting at $50.1 million.
In terms of sales revenue, the company saw a marginal decrease of 5 per cent in Australia and New Zealand. However, revenue growth was strong in Europe, Middle East and Africa, where it increased by 14 per cent, and in Asia revenue increased by 12 per cent.
Bravura acknowledged “increased foreign currency volatility” during the half-year period as a result of the current economic downturn, saying in its statement to the ASX that reported revenue in the half-year period was reduced by $2.8 million due to “foreign exchange fluctuations”.
