PPS -35.34%: a tough day for the investment platform business, tumbling on comments made at their AGM. The company has been working hard to right size their cost base but it is facing headwinds on both costs and revenues and today’s update sent the stock to 3-year lows. On the revenue front, lower trading volumes have weighed on income given Praemium clips the ticket on activity. They also take their keep from cash balances which have been running lower than FY23.
On the cost front, the company will take a one-off $1m hit on restructuring charges and capex continues to climb in line with inflation. As a result, the company expects 1H EBITDA to be down 20% on last year where consensus was expecting ~10% growth. A pretty frustrating update from the company today, our outlook turns more cautious as a result
MM is now neutral PPS
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