Iress Posts 19% EPS Growth Amid Strategic Transformation and Divestments
Iress Limited has reported a 19% increase in underlying earnings per share for its continuing business in the first half of 2025, completing a major transformation and reaffirming its full-year guidance despite revenue pressures from divestments.
- 19% growth in underlying EPS for continuing business
- Completion of transformation program and divestment of Superannuation business
- Adjusted EBITDA down 3.9% overall but up 8.7% on continuing operations
- Balance sheet strengthened with leverage ratio reduced to 0.8x
- Interim dividend declared and leadership restructure announced
Strong Core Performance Despite Revenue Dip
Iress Limited (ASX, IRE) has delivered a robust first half in 2025, with its continuing business reporting a 19% increase in underlying earnings per share compared to the prior corresponding period. This growth comes even as total revenue declined by 3.1%, largely due to the strategic divestment of non-core assets including its Superannuation business.
The company’s adjusted earnings before interest, tax, depreciation, and amortisation (EBITDA) fell 3.9% overall to $64.4 million but rose 8.7% on a continuing business basis, reflecting operational efficiencies and pricing improvements. Operating costs decreased by 2.9% overall, though they increased by 6.2% within continuing operations due to heightened investment in research and development focused on next-generation wealth technologies.
Transformation Complete, Balance Sheet Strengthened
CEO Marcus Price highlighted the completion of Iress’ transformation program as a pivotal milestone, enabling the company to streamline its operations and sharpen its strategic focus. The sale of the Superannuation business has notably strengthened the balance sheet, reducing the company’s leverage ratio to a conservative 0.8 times, down significantly from the prior period.
Looking ahead, Iress is on track to complete the divestment of QuantHouse in the second half of 2025, further refining its portfolio. The proceeds from these divestments are being reinvested into complementary new products and technologies, particularly in cloud computing and artificial intelligence, aimed at expanding the company’s wealth technology offerings and enhancing trading experiences globally.
Guidance Reaffirmed and Dividend Declared
Despite the ongoing investments and divestments, Iress has reaffirmed its full-year 2025 guidance, targeting adjusted EBITDA between $127 million and $135 million and underlying profit after tax between $65 million and $73 million. The board declared an interim dividend of 11 cents per share, 50% franked, reflecting confidence in the company’s cash flow and earnings stability.
Leadership Changes Signal New Phase
In a notable leadership update, Iress announced the elimination of the Deputy CEO role, with Harry Mitchell departing after two years of significant contributions, including overseeing the UK business turnaround and key divestments. This change signals a streamlined leadership structure as the company moves into its next growth phase.
Overall, Iress appears well-positioned to capitalise on emerging opportunities in global financial technology markets, leveraging its core strengths while embracing innovation in AI and cloud services to meet evolving client needs.
Bottom Line?
Iress’ strategic reset and disciplined investments set the stage for sustained growth, but the market will watch closely as new technologies and divestments reshape its future earnings profile.
Questions in the middle?
- How will the upcoming QuantHouse divestment impact Iress’ revenue and profitability in the second half?
- What returns can investors expect from the increased R&D spend on AI and cloud-based wealth technologies?
- How will the leadership restructure affect execution of Iress’ growth strategy and operational agility?
