The Link Administration Holdings Ltd (ASX: LNK) share price could be on the move today after the release of a business update.
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What did Link announce?
Ahead of its business update event, the administration services company released a presentation which included a summary of how it is performing so far in FY 2021.
According to the release, Link has started FY 2021 positively, thanks largely to its resilient revenues. Management notes that 84% of its revenue is classed as recurring.
In light of this, the company is on track to deliver revenue of $594 million for the first half. This represents a 4.8% decline on the prior corresponding period's revenue of $624 million.
Link also revealed that its top five Retirement & Superannuation Solutions (RSS) clients have either renewed or an on track to renew their contracts. It has also experienced continued strong member growth. And with macroeconomic conditions improving, management appears optimistic that this will continue.
It also revealed that the key PEXA business is performing very positively. Since June, monthly transactions have continued to grow as PEXA's digital platform and networks drive further penetration across Australia.
Another positive is that its Global Transformation Program is on track and further upside from the program is now expected. It has made a 50% increase to its FY 2022 target, lifting it from $50 million to $75 million.
In respect to earnings, management advised that it is expecting its operating net profit after tax before amortisation (NPATA) to come in at $57 million for the first half. This will be down 29.6% from the $81 million it achieved in the prior corresponding period.
FY 2022 momentum.
Looking ahead, the company believes it is well-placed for FY 2022 and beyond.
It advised that it has good momentum going into FY 2022 and notes that its RSS business has won a major contract with Hostplus. Furthermore, its Pepper European Servicing capabilities are expected to strengthen its Banking and Credit Management.
