Strong Rise this Year, Can it Continue its Upward Journey Further
Bravura Solutions’ stock is up more than 125% for this year on the back of its strong FY25 recovery, improving cash flows, a business model with high switching costs as it looks to continue this growth in the future.
Bravura Solutions Limited (ASX: BVS)
showed a strong rebound in FY25 as it keeps building its spot as a global player in wealth management and funds admin software and this has been reflected in it’s stock price as well because it is up more than 125% in one year. The big event for the year was the A$56.2M one time licence sale to Fidelity International which lifted the statutory profit but even if we look at it without that deal the company still posted solid growth. Total revenue went up 3.3% to A$258.7M, helped by more digital advice sales. Underlying EBITDA almost doubled to A$50.5M. Margins got much better too because of lower staff costs and less third party expenses. Reported NPAT jumped to A$74.2M compared to A$8.8M last year and underlying NPAT came in at A$24.4M, which is 177% higher. EPS grew to 16.6cps backed by cost discipline and steady recurring revenue.
Cash flow also looked way better this year with Cash EBITDA at A$43.8M and operating cash inflows climbing to A$100.6M, more than triple last year’s level. Bravura ended FY25 holding A$58.7M in cash and with zero debt. The company also gave back A$21.1M in dividends which included a final dividend of 2.92cps and a special dividend of 1.79cps. Free cash flow for shareholders hit A$41.1M which shows both stronger operations and tighter spend on software development and office costs. Net tangible assets were 10.4cps compared to 16.7cps last year mainly because of dividends and equity changes but the business model is still capital light and provides moat characteristics of Switching costs and network effects.
Looking ahead, Bravura is set on expanding its solution set across EMEA and APAC, putting more focus on cloud and managed services that can lift efficiency and help with regulatory compliance. Digital advice tools are now used by more than 6 million members and the company is still signing up new clients in both wealth and advice segments. The plan from management is to stick with organic growth, improve automation and push margins higher with incentives tied to revenue and cash EBITDA in each business unit. Risks are still there from currency moves, client concentration and fast tech changes. But with better profitability, no debt, and steady shareholder returns, Bravura looks to have a strong base for ongoing growth.
(Source: Company Announcements)
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