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Problems in the finance sector have hit finance and banking software company Finzsoft Solutions, which is reporting a 44 per cent fall in half-year net profit after tax to $145,000.
Chairman Don Hattaway said the appetite of many of Finzsoft's clients in the finance sector to invest in growth and product development had been affected by pressures on the sector.
That in turn had a ripple effect on revenue for Finzsoft and resulted in a disappointing first half, which was likely to continue for the rest of the financial year.
Profit had fallen below expectations as the company incurred transition costs following a change in majority shareholding, Mr Hattaway said.
In June, Pi Capital Investments acquired 63.6 per cent of Finzsoft's shares.
Trading revenue for the six months to the end of September was up 15 per cent on the corresponding period a year ago, to $4.7 million.
At the end of September, Finzsoft had $2.4 million cash at bank and receivables of $1 million, a strong position from which to invest in the company's product and market, Mr Hattaway said.
The balance sheet also did not fully reflect the continued investment and enhancement of the company's Sovereign finance and banking software product, which remained Finzsoft's main asset.
Client reluctance, due to market conditions, to invest further in the operating platform was providing an opportunity for Finzsoft to focus its efforts on product enhancement, he said.
That would enable Finzsoft to develop its product to appeal to a broader client base. Finzsoft intended to increase its presence and focus on growth opportunities in Australia, where it was having success.
No interim dividend is to be paid. Finzsoft shares last traded at $1.12 last Tuesday, having ranged between 90c and $1.31 in the past year.
- NZPA
