Praemium (ASX:PPS) has renewed a contractual arrangement with a...

Praemium (ASX:PPS) has renewed a contractual arrangement with a long standing customer to provide portfolio administration services for a further 5 years.

Praemium has been providing portfolio administration to this major financial institution for the last 7 years, following an initial term of 5 years and two 1-year extensions.

The current contract period is to 7 November 2014. Praemium’s reported revenue in FY2014 for services to this customer was $1.6 million.

This new agreement, commencing on 8 November 2014 with a fixed contract term of 5 years, has a minimum contract value of $3 million per year

Praemium is capped at $76 million.

Praemium’s Australian and international Separately Managed Account (SMA) platforms continued their strong momentum from the previous quarter, despite generally weak market conditions.

These strong inflows also helped drive Funds on Platform to new highs, increasing by 8% to $2.65 billion. Funds on the Australia platform rose to $1.6 billion and the international platform to $1.05 billion.

Quarterly gross inflows were $286 million, the second highest behind the Junes quarter’s record of $320 million.

Existing customers such as Centrepoint Alliance and Agentia have relaunched their SMA services with new diversified model portfolios in both super and non-super structures.

New customers such as Astute Financial are now using multi-asset models managed by professional investment managers to provide low-cost access to investments suitable for their client’s risk profiles.

The fact that wealth managers are increasingly turning to SMAs to help deliver more efficient and transparent investment solutions to their investors is further indication that the appeal of SMA platforms is growing rapidly within Australia’s $500 billion platform market.

The company booked an operating cash inflow of $283,000 for the quarter.

Positive operating cash flow has now been reported in 8 of the last 10 quarters, including the last 3 consecutive quarters.

Cash balance was $9.1 million at 30 September 2014.