Praemium bleeds $414m in quarterly net outflows
Praemium has seen net outflows of $414 million over the June quarter driven by advisers continuing to transition from its Powerwrap platform.
Announcing its quarterly results to 30 June 2024, Praemium’s triple-digit net outflows contrasted its positive result during the March quarter, which brought in net inflows of $201 million.
The $414 million outflows were largely underpinned by its bleeding Powerwrap platform that saw net outflows of $437 million over the quarter. This result is over eight times higher than its $53 million in net outflows for the March quarter, which was an improvement from the December quarter with $334 million outflows.
Quarterly platform flows
| June 2023 | March 2024 | June 2024 | |
| Powerwrap flows | $42 million | -$53 million | -$437 million |
| Total net flows | $122 million | $201 million | -$414 million |
Praemium chief executive Anthony Wamsteker attributed Powerwrap’s non-systemic outflows to transitioning advisers which “continued to have an adverse impact”.
“Gross outflows from transitioning advisers were approximately $1 billion for the financial year. The overall net outflow impact across the last three quarters is in line with previously stated estimates of impact. Absent any further adviser movement, it is currently estimated to continue at a similar rate for another six months,” he explained.
“Over the long term Praemium and Powerwrap clients have typically grown their businesses at strong rates. This should ameliorate the negative impact of the transitions which might arise from the known adviser exits.”
The OneVue platform, which was sold to Praemium from Iress in April 2024, also experienced triple-digit outflows in the three months to 30 June at $126 million. This was broadly in line with expectations given pre-acquisition due diligence, the CEO noted, marking a $48 million improvement from the March quarter with outflows of $174 million (pre-acquisition).
The Praemium Separately Managed Account (SMA) scheme, which Wamsteker described as its “cornerstone product”, enjoyed net inflows of $149 million over the June quarter. However, this was down from $254 million in the previous quarter. Over the 2023–24 financial year, the SMA scheme has accumulated $820 million in net inflows, representing approximately 9 per cent of opening funds under administration (FUA).
Looking at the firm’s total FUA, it grew from $53.3 billion in the previous quarter to $57.4 billion this quarter, up by 30 per cent from 30 June 2023.
Platform FUA rose to $28.1 billion from $24.3 billion in the previous quarter, which excluded OneVue. Since June last year, it has expanded by 26 per cent, the ASX statement noted.
The CEO added: “The June quarter showed a continuation of the positive impact to SMA of improved cross-selling from our non-custodial VMA and VMAAS services.
“The strong growth in FUA on VMAAS highlights the tremendous potential of that service. Our non-custodial capability remains market leading and represents a significant opportunity for Praemium.”
AUTHOR
Jasmine Siljic
Recommended for you
Net cash flow on AMP’s platforms saw a substantial jump in the last quarter to $740 million, while its new digital advice offering boosted flows to superannuation and investment.
Insignia Financial has provided an update on the status of its private equity bidders as an initial six-week due diligence period comes to an end.
A judge has detailed how individuals lent as much as $1.1 million each to former financial adviser Anthony Del Vecchio, only learning when they contacted his employer that nothing had ever been invested.
Having rejected the possibility of an IPO, Mason Stevens’ CEO details why the wealth platform went down the PE route and how it intends to accelerate its growth ambitions in financial advice.
