After shedding several business lines under former chief executive Marcus Price, Xplan-owner Iress will enter a business efficiency program ahead of the start of successor CEO Andrew Russell.
The group announced to the ASX on Monday it would launch the program to boost margins, as well as confirming its FY25 guidance.
The firm said the business efficiency program was designed to improve operating leverage and profitability.
The program targets a cash earnings before interest, taxes, depreciation and amortisation (EBITDA) margin of 25 per cent by the end of FY26, compared to an approximately 19 per cent cash EBITDA margin for FY25.
The firm’s half year results in August showed an adjusted EBITDA margin of 24.1 per cent.
“This increased level of margin performance is expected to be maintained on an ongoing basis, reflecting a structurally more efficient operating model,” the firm said.
To hit that target, the company plans to invest in its core platforms, build new revenue streams including AI-enabled capabilities.
The change in executive leadership comes with the company reportedly up for sale, including a withdrawn offer in August from Blackstone for $10.50 a share valuing the company at $1.96 billion, and undisclosed third-party suitors announced last month.
Iress announced the appointment of Russell in early September, succeeding Price who joined in 2022.
Russell was previously group CEO and managing director at Bravura Solutions and has also held roles at Class, REA Group, Mortgage Choice and Virgin Money Australia.
Russell was given a base remuneration package of $950,000 including a short-term incentive bonus of between 100 per cent to 150 per cent of his annual salary, along with a long-term incentive opportunity of 150 per cent of his base salary.
He also would receive $1.1 million worth of company securities to compensate him for the forfeiture of his holdings in Bravura.
The company has divested several core businesses over the past couple of years, now simplified to two business units: wealth and trading and market data.
Price replaced Andrew Walsh, who had founded Xplan before it was acquired by the firm, and oversaw a strategy refresh where the company reduced staff by 10 per cent, overhauled the leadership and divested several business units that no longer became core to the overall strategic direction of the firm.
The group sold its managed fund administration service to global software provider SS&C Technologies in August 2023.
Iress sold its platform service for $52 million to Praemium, which held the YourChoice Super and Australian Practical Super platforms that hosted First Guardian Master Fund, around the same time preliminary investigations into the troubled fund commenced.
Praemium confirmed last month that its exposure to First Guardian included $176 million in YourChoice Super and $107 million in Australian Practical Super.
Iress sold its superannuation business to Bermuda-based global financial services provider Apex Group in January and its UK mortgage broking business in August 2024.
The group’s transformation project had seen improved revenue and reduced costs with improved FY results reported earlier in the year, with statutory net profit after tax (NPAT) growing from a 164.5 per cent loss of $137.5 million to a profit of $88.7 million.
