New partners improve Decimal’s bottom line

22-Feb-2017

By Sarah Kendell

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Digital advice provider Decimal significantly reduced losses in the first half of the 2017 financial year, recording a 29 per cent revenue increase as a result of several major partnerships with superannuation funds.

In its half-year report released to the ASX yesterday, the group revealed a consolidated net loss after income tax of just under $2.4 million for the six months to December 2016, a result that showed improvement on the $4.1 million loss reported in the same period in 2015.

While still some way off profitability, Decimal said it had reduced company expenditure by 43 per cent over the six months, while revenue increased from $358,000 in the six months to December 2015 to $462,345 in the first half of 2016/17.

The group indicated proceeds from customers had also increased 72 per cent during the period to just over $698,000, while it had also benefited from $1.5 million worth of government research and development (R&D) grants.

“The R&D payment provides additional funding for the company’s ongoing sales and marketing program for [digital advice platform] Eqilize, as well as enabling further development of its platform offerings for major banks,” Decimal noted.

“The company’s position as the premier provider of enterprise digital advice software to Australia’s superannuation industry strengthened considerably during the period.”

The group’s funds under advice also increased by 194 per cent compared to the prior corresponding period, up to $5 billion from $1.7 billion in the six months to December 2015.

Decimal noted it had rolled out agreements with Energy Super, Statewide Super and an undisclosed third fund in the second half of 2016, with the Eqilize platform having gone live to all Energy Super members in September, while the Statewide offering was to be rolled out over the next three years.

Foundation client Mercer was also in talks to extend the scope of its existing partnership with the firm.

“The contracts demonstrate Decimal’s growing presence among superannuation providers and highlight the continued emergence of the digital financial advice sector and adoption of the technology by enterprise to enhance the superannuation experience,” the company said.

“Accordingly, as the market continues to evolve rapidly, so does Decimal’s sales pipeline for the half-year ahead.”

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