IRESS CEO Andrew Walsh

As far as company results calls go, Iress CEO Andrew Walsh had a pretty easy run Thursday morning.

The integrated software provider has had a stellar run in the last five years, with a remarkably consistent revenue growth of about 8 per cent per year, a share price at an all-time high and a pipeline so healthy shareholders have been told to expect a doubling of net profit after tax by 2025.

In a sign the group has really hit its straps, the buyout bids are coming in. Two weeks ago Iress entertained EQT’s advances, only to reject their conditional offer.

What’s interesting about Iress is that for a firm built on the back of its success catering to the software needs of financial advisers, it has developed rather quickly into a diversified technology company with advice as an increasingly marginalised part of its ecosystem.

It’s not that Iress doesn’t need, or value, advisers as clients. The group is a firm supporter of advice, Walsh says.

But the exponential growth of the company during a time when the advice market is shrinking considerably is a clear indicator that the listed group has its fingers in more than one pie.

On a call with Professional Planner shortly after he delivered the group’s H1 results, Walsh says Iress is simply in the business of delivering software to users.

“Those users are not only advisers,” he says. “The number of users that we service is not directly correlated to the number of registered advisers there are. There are users of our software that are wholesale investment advisers, not registered investment advisers with ASIC, and the same is true in other markets.”

It’s a fair call. Iress extends its suite of around 12 advice software platforms to stockbrokers, accountants, and a whole spectrum of financial services players that aren’t registered advisers. It’s global footprint is growing, especially in the UK.

The group also has about the same number of software products that do trading and market data, investment management, mortgages and superannuation administration.

Then there is its acquisition of investment platform OneVue, which is in the process of being bolted onto Xplan, and the associated unit registry business it received as part of the $170m deal.

There is some conjecture about the OneVue play. The platform itself is subscale and a little clunky compared to its contemporaries HUB24 and Netwealth, yet Iress has the expertise to significantly improve the platform. It also has the ultimate trojan horse in Xplan.

Insiders reckon the real value in the OneVue deal, however, is in the fund unit registry business. While a low margin vertical in isolation, the data applications for a tech company here are attractive, as are the advancements blockchain could bring.

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