Finzsoft in profit warning, strikes deal with First Credit Union
By Edwin Mitson
March 31 (BusinessDesk) - Finzsoft Solutions, the listed Auckland-based software provider to banks and financial
services companies, has warned investors profits will be "materially lower" when it publishes its full-year results for
the year to the end of March.
The company is currently in the process of adjusting its financial year reporting to June 30 to align itself with its
majority shareholder, Silverlake Axis Group, who took control last year. It agreed with the NZX to publish interim
results to March 31 by the end of May.
Managing director Andrew Holliday said the company expects a profitable outcome for the 15 month period the end of June
2016.
Finzsoft's $2.7 million net profit in 2015 was a significant jump on the year earlier's $754,549 profit. In its 2015
annual report the company said the strong profit growth reflected a "robust order book" and "our focused efforts in
Australia paying off".
In his note to investors today, Holliday said the decline was due to a number of contractual and market factors. "These
factors include contracts that have been delayed, longer than expected timeframes to access the new business
opportunities in the Asian markets, increased investment in subsidiary Sush Mobile. Market factors include the changing
nature of customer demand and spending patterns with an increased proportion of customer budgets being applied away from
core enterprise technologies to disruptive digital ecosystems."
Holliday said the company's cost base is being "proactively managed" due to these changes. Between 2014 and 2015 the
cost of salaries and wages at Finzsoft soared from $4.7 million to $8.8 million, according to its annual report.
Finzsoft bought Sush Mobile on Sep 13. 2014.
Finzsoft has also announced an agreement with New Zealand's largest credit union, First Credit Union, as its preferred
partner to runs its software and technology for its 62,000 members. Holliday said First Credit Union will be a strategic
customer for Finzsoft because of its "size and scale."
Shares in Finzsoft were unchanged at $2.25. The value of the shares has fallen 30 percent in the past year.
(BusinessDesk)