Managed Accounts post loss after Linear acquisition

Managed Accounts Holdings have reported a $2.5 million dollar loss in the 2017-18 financial year, with the cost of acquiring Linear in late 2017 weighing on profits.

In a statement on the ASX, the company said it made a net loss of $2.5 million dollars in the most recent financial year, after making a $0.67 million profit in the previous reporting period.

“The loss included $1.26 million acquisition costs, a $1.93 million asset write off mainly relating to the write off of discontinued software being developed and non-cash employee share option scheme expenses of $0.28 million,” the statement said.

ifa understands this write-off was the result of the business cancelling the outsourced development of new customer front-end software after the acquisition of Linear permitted the development to be conducted in-house.

The development of the new software is expected to be completed by the fourth quarter of this year.

The business’ adjusted earnings before interest tax depreciation and amortisation (EBITDA) was $2.87 million, 95 per cent above the previous financial year and “comfortably” higher than the company’s previous guidance.

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Managed Accounts Holdings chief executive David Heather said these results indicated the “early benefits” of the Linear merger.

“The merger with Linear has been a transformational transaction for the business, enabling it to consolidate its evolving position as a leading provider of investment administration solutions in the Australian market with a specialisation in managed accounts,” Mr Heather said.

The business’ funds under administration at the end of the 2017-18 financial year was $13.09 billion, the statement said.

Managed Accounts post loss after Linear acquisition
Managed Accounts Holdings, ManagedAccounts.com, ASX, annual results, Linear, acquisition, mergers and acquisitions, M&A,
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