Praemium posts $3.3 million loss amid restructure
Portfolio administration firm Praemium has announced a $3.3 million net loss before tax for the first half of the 2011/12 financial year.
The majority of the loss was attributable to the UK subsidiary of the company, which posted a $3.2 million net loss before tax.
Praemium also wrote-off $221,000 "due to the UK subsidiary not yet being in a position to repay interest on intercompany loan balances".*
The loss includes a one-off cost of $1.2 million for a restructure announced in September last year aimed at reducing costs throughout the business.
According to the director's report for the half year ended 31 December 2011, the restructure is "nearing completion" and is expected to result in annualised savings of "approximately $3 million", or a 16 per cent reduction in the 2010/11 financial year cost base.
After one-off costs were taken into account, Praemium's half year loss was $1.84 million - a 15 per cent improvement on the half year to December 2010.
Praemium chief executive Michael Ohanessian said the company had "effectively halved its cash burn" following the restructure.
"The profitability of the Australian business is now in a much stronger position, which allows us to focus on longer term strategic opportunities," Ohanessian said.
The company was also eagerly anticipating the regulatory changes taking place in 2012 in both Australia and the UK, he added.
* Correction: This article originally stated, incorrectly, that Praemium wrote off $221 million.
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