ASX-listed technology firm Praemium has posted a net loss of just over $10 million in the year to June 2007.

In its annual report released earlier last week Praemium revealed the bulk of its losses were attributable to its expansion efforts in the UK. The group raised over $20 million when it listed in May 2006 and a further $10 million in a rights issue the following May to fund its UK ambitions. In a joint statement, Praemium CEO, Arthur Naoumidis, and the company’s chair, Don Stammer, said the group’s capital expenditure is currently focused on the UK “where we believe a significant opportunity exists”. “The United Kingdom financial services sector is much larger than Australia’s and we believe it is becoming receptive to Australian based investment administration platforms such as our SMA [separately managed account] platform,” the statement said. While the group has signed several heads of agreement with UK businesses as of the June 30 reporting date no revenue has been sourced from the UK. In the year to the end of June Praemium reported revenue of just under $5 million from Australian clients. The bulk of the company’s expenditure has been on staff ($9.3 million) and professional, insurance and advertising costs ($3 million). Over the reporting period staff in Praemium’s UK office jumped from two to 21. Of the $10 million raised in May 2007 Praemium says it unexpectedly had to set aside £2 million (about A$4.6 million) as working capital reserve for its UK subsidiary SMArt Operator. “The extent of capitalisation requirements was not known at the time of the initial IPO and therefore was not catered for in that raising,” the report says. “In addition $5,000,000 of the funds raised were allocated to the acquisition, development and launch of Praemium Desktop and UK operational costs over the next three years.” Praemium also reported cash assets of $16.7 million as at June 30 this year with no net debt. In Australia almost 350 financial services businesses subscribe to Praemium’s V-wrap which represents close to $24 billion funds under administration. As well, almost 60 dealer groups have signed on for its SMA product.

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