Ann: HALFYR: FIN: Finzsoft Solutions Amended 30 Sept 2015 Half Year Report

• Release Date: 02/12/15 08:57
• Summary: HALFYR: FIN: Finzsoft Solutions Amended 30 Sept 2015 Half Year Report
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02/12/2015 08:57
HALFYR
PRICE SENSITIVE
REL: 0857 HRS Finzsoft Solutions Limited

HALFYR: FIN: Finzsoft Solutions Amended 30 Sept 2015 Half Year Report

Finzsoft Solutions Limited (NZX:FIN) Reports Interim Financial Results for
Half Year Ended 30 September 2015

Finzsoft Solutions Limited wishes to advise, that Note 3 to the Financial
Statements regarding Segment Information within the announcement for NZX
titled "30th September 2015 Half Year Report", requires a correction. The
first two lines of the note should read:
Segment revenue from external customers: New Zealand $4,963 (previously
$8,112) and Australia $5,982 (previously $2,833).
Adjusted EBITDA: New Zealand $1,255 (previously $4,345) and Rest of the World
-$3 (previously -$3,093).

The correction has not required Finzsoft to make an adjustment to any of its
financial statements, total revenue, director's statement, or any other
performance measures.

This announcement serves as a correction and a revised half year report is
attached.

CONTINUED YEAR-ON-YEAR GROWTH & CONTINUED STRONG MOMENTUM LEVERAGING
OPPORTUNITIES IN ASEAN POST TAKEOVER

Finzsoft is pleased to announce its performance highlights for Half Year
Ended 30 September 2015:
o Record six month operating revenue result of $11 million, an increase of
$3.1 million (39.4%) from $7.9m million at 30 September 2014.
o Compound Annual growth for the corresponding period of 22.1% operating
revenue over five years.
o Strong and continued customer base with supporting underlying recurring
licence and services revenue.
o Current Market capitalisation of nearly 200 percent higher than at the end
of the corresponding period last year, and over 700 percent higher than at
the end of the corresponding period in 2013.
o Strong EBITDA result of $0.9 million notwithstanding continued material
investment in R&D and marketing. First period revenue and EBITDA also
impacted by time deferred intercompany sales, now to be completed in the
second six-month period.
o Continued profitability, no debt and positive cash flow.
o Net profit after tax has reduced to $0.147 million, down from ($2.023
million) for the same period last year, largely due to full period inclusion
of Sush (together with increased base costs), as well as investment in and
operational losses incurred by the Sush Mobile subsidiary.
o Andrew Holliday has confirmed his intention to re-contract as Managing
Director. This reappointment has the full support of the Finzsoft and
Silverlake Axis Boards for Mr Holliday's continued role for at least the next
for five years.
o Continued material investment in sales and marketing to continue to
leverage and convert the opportunities in ASEAN brought about by the
Silverlake investment.

Over the past six months, Finzsoft has focused on the following operating
priorities:

o Settlement of the Full Takeover, understanding inter-group integration and
leverage opportunities, understanding and shaping a target end state Group
solution offering and go-to-market strategy for the 120 plus incumbent and
established top-tier banking and insurance customers of the Silverlake Group.

o Investment and settling in of our entry into omni-sector digital services
through the final settlement of the Sush business.
o R&D investment for growth in next generation software solutions, in
particular, omni-channel Customer Interface solutions.
o Ongoing delivery to significant Westpac/St George and other key customer
work orders.

Finzsoft Solutions Limited (NZX:FIN) today reported its half yearly earnings
to September 30, 2015, continuing Finzsoft's strong revenue growth while
investing in the company to set up for long term sustainable growth in New
Zealand, Australia and the wider ASEAN region.

"Finzsoft delivered strong growth, particularly in the Australian market with
increases in the size and value of work orders from existing clients.  We've
achieved this while continuing to invest in research and development of our
Sovereign product and our next generation offerings," said Finzsoft Managing
Director, Andrew Holliday.

"Something interesting and exciting is happening, and Finzsoft is well
positioned to continue to embrace opportunities and to lead from the front.
The dominating companies of today embrace the reality that customers lives,
their needs and their social context are inextricably linked to the digital
economy. At their core they have understood that they do not create needs,
nor do customers really care what they do or how they do it, but rather why
they do it. Does your offering add value to my life, now, is the mantra of
our age.

Customer delight has deposed satisfaction, as customer empowerment and the
demand for services that will add value to a customer's life have displaced
product or brand loyalty. Today customers are choosing to vote with their
feet as they embrace the sector disruptors and in so doing they demonstrate
that the traditional products and models of service delivery are no longer
relevant to their lives today. These disruptors have understood and enshrined
as their core value that the internet and mobility are the most powerful
mechanisms needed to empower connectedness between people with a need, to
people with the goods, the services or the solutions to that need. In an age
of commoditisation of core services, core IT and digitalisation, the battle
is for, and the value lies in, the Interface(s) that empower Connectedness.

In understanding these market and social dynamics, Finzsoft has, and
continues to, adapt and evolve its offerings. We have done this by leveraging
off our past two decades of legacy, by continuing our investment and strong
performance over the past five years, and evolved and embraced our role as a
disruptor in the provision of Life-style banking, finance and insurance
solutions. At Finzsoft, we believe in empowering people to choose, access and
consume products and services anytime, anywhere and in the way they want
through omni-channel single experiences. In everything we do we seek to
encourage customers to start from outside the circle, to challenge and think
differently in order to be empowered to not only disrupt, but redefine and
lead in order to win the battle for and own the customer interface.  The
continued success of our strategy is demonstrated through continued,
repetitive strong performance as demonstrated in today's announcement", said
Holliday.

Despite continuing and strong revenue growth, the profit after tax has
reduced when compared to the same period in 2014, largely due to operational
losses from the Sush Mobile subsidiary which are NZ$862k behind budget.
Holliday said that had the Sush result been profitable, Finzsoft's after tax
profit would have been similar to the prior year.

"The losses were driven predominantly from the need to upgrade Sush systems,
processes and capabilities from rudimentary start-up levels to tier one
enterprise grade, larger than expected triage work required following the
acquisition of Sush and the hiring of world-class talent into the business as
Sush prepares to drive profitable growth into FY16.  The status of and
results from the business are not what we anticipated. Although the status of
the business and the extent of the triage was disappointing, the Board
remains confident that a digital focused evolution of the business is in the
Group's long-term best interests with the rise of the digital only customer.

Based on the current contracted revenue, along with our pipeline
opportunities for our financial year ending 30 June 2016, we will expect to
see Finzsoft continuing to operate profitably with no debt and positive cash
flow.  We have ongoing delivery to our key client work orders both in
Australia and New Zealand".

The Company's focus remains on delivering tools and platforms that drive
efficiencies into traditional banking operations and practices and enable its
clients to be at the forefront of mobile solutions for their staff and
customers.

A lot has been done to talk and document the changing consumer behavior,
however very few institutions in Asia Pacific really understand how to
respond to this changing behavior, or what the best strategy is for them.
Research shows that the real stickiness lies in customer communication
consistency, not brand or products. Customer delight has deposed
satisfaction, as such a bank or insurance institution should be able to
seamlessly access information (data), connect and interact with their
customers through any channel, 24/7, and the customer with their service
providers. This new, bespoke banking practice is termed as Life-style Banking
and Insurance.  In an age of commoditisation of core services and
digitalisation, the battle is for, and the value lies in, the Interface(s)
that empower Connectedness." Said Holliday

Finzsoft is seeking continued strong and increased appetite for its Customer
Interface, vertical and core modules and services.

"Investment in R&D is critical to delivering the innovations our customers
require to offer their customers the on-line experiences and products they
want in the palm of their hands whenever they make a purchasing decision,"
said Holliday.

"Delivering the best new solutions first is also how we will leverage the
opportunities for new customers amongst the 120 top-tier banks across Asia
that our relationship with Silverlake Axis gives us access to," he said.

"We are focussed on expanding our client base and with the recent acquisition
of Finzsoft shares by Silverlake Axis Group together with my interests
through Silverlake HGH Limited, we see significant opportunities for future
growth in the ASEAN markets, which we are working to leverage and convert,"
said Holliday.

Earlier this month, Finzsoft Group and Silverlake Axis Group ("SAG") hosted
SAG's clients in Queenstown for the annual Silverlake Axis Group Client
Summit.  With over 150 attendees including representatives from the top-tier
financial service organisations across ASEAN attending, Mr Holliday said the
Silverlake client summit was an 'excellent opportunity' to engage with key
customers within the ASEAN region and allowed Finzsoft to showcase our next
generation omni-channel digital solutions to key decision makers.

"Finzsoft is currently in a transition phase with the Silverlake Axis
relationship.  As previously noted, we are actively investing in Asian
opportunities, particularly those that we can build from our Silverlake
partnership.  We believe investing in these opportunities will create
long-term shareholder value.

In line with our growth strategy, Finzsoft is growing its capability with
leading talent joining the company across all areas to continue the
development of our technologies and to support our growth aspirations the New
Zealand, Australian and Asian markets." Said Holliday.

In order to position the Company for future growth, three key executive
appointments and one board appointment have been made during the period
adding senior mobile, finance and banking leadership to the Finzsoft team.
These are:

o Craig Parnham has been appointed as CEO for Finzsoft subsidiary, Sush
Mobile.
o Brad Edley, who comes from an international corporate and commercial
background, to be Finzsoft's Chief Financial Officer.
o Finzsoft was also pleased to welcome Silverlake Axis Group CEO & Managing
Director, Dr Raymond Kwong joined the Finzsoft Board.

Dr Kwong says that he looks forward to working more closely with the Finzsoft
team as the company expands to meet a growing demand for its customer
interface, digital, vertical and core banking and insurance solutions. "There
are strong synergies between Silverlake's product and solutions, and I look
forward to working with Andrew Holliday and his team as they provide
transformational next generation customer interface, digital and vertical
solutions to our customers and they continue the company's growth through new
technologies and by broadening into new industries and markets."

In the first half of this year the company has been focussed on settling in
the Silverlake relationship and on the integration of Sush Mobile into the
Finzsoft group.  Holliday said the management team would continue to focus on
both operations and profitability of Sush to enable the business to reach its
full potential to contribute both revenue and new mobile innovations.

Short-term earnings have been impacted by the upfront investment in sales and
marketing spend in this six-month period as compared with the prior period.
This related to the Silverlake Queenstown conference and the IDC conferences
at three locations across Asia where Silverlake provided Finzsoft the
opportunity to headline its stand at these important ASEAN industry
conferences.

Holliday said the board and management see the next 12 months as an
investment phase for the company backed by continued focus on revenue growth.

"With ongoing investment in its people, processes and infrastructure to
support the future plans of the Group, the company will be well positioned to
capitalise on the opportunities for growth that the board and management have
identified.

I am personally very excited to be part of the Finzsoft and Silverlake
journey, and part of lifestyle technology transformation that will mark the
next five years. I believe this next phase will be the most exciting in our
and our company's histories" said Holliday.

The Board will be meeting in mid-December to consider whether an interim
dividend will be announced.

Authorised for issue on the 30th of November 2015.
End CA:00274483 For:FIN    Type:HALFYR     Time:2015-12-02 08:57:02