GBST reports profit of $10m

International growth strategy fuels profit rise, says managing director Stephen Lake

GBST managing director Stephen Lake.

GBST managing director Stephen Lake.

Financial software provider GBST (ASX: GBT) has reported a profit of $10 million for the year ended 30 June 2014, a 66 per cent increase on the same period in 2013 when it reported a profit of $6 million.

Earnings before interest, tax, depreciation and amortisation (EBITDA) rose 24 per cent to $20.5 million. In 2013, the company reported an EBITDA of $16.5 million.

GBST’s revenue also increased to $98.5 million, up 19 per cent on last year’s revenue of $83 million.

In an ASX statement, GBST managing director Stephen Lake said its international growth strategy in Asia, Europe, the United Kingdom and United States had led to the increase in sales and profits.

The company is made up of three divisions: capital markets, wealth management and financial services.

International capital markets revenue was at $11.7 million, an increase of 75 per cent on 2013 when the company recorded international revenues of $6.7 million.

“International sales of GBST Syn~ software grew significantly, including completion of a major deployment for one of the world’s largest banking and financial services firms in Asia,” he said in a statement.

GBST turns business around following Syn~ restructure

According to Lake, the company’s capital market revenue in Australia rose slightly to $29.5 million, a 3 per cent increase from $28.8 million in 2013.

“In Australia, our operations performed well and achieved a strong result in a patchy market. The majority of our capital markets revenue comes from annuity licence fees from long-term contracts, and revenue improved slightly despite difficult trading conditions,” he said.

Turning to wealth management, the company’s Australian revenue of $18.2 million remained unchanged since 2013.

However, international wealth management revenues rose to $35.6 million, a 41 per cent increase on the $25.2 million recorded in 2013.

GBST’s financial services division did not fare so well with a 12 per cent drop in revenue from $3.5 million in 2013 to $3.1 million in 2014.

Follow Hamish Barwick on Twitter: @HamishBarwick

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