Bravura Solutions Limited trading update and fourth quarter cash flow

31 July 2007 Bravura Solutions Limited trading update and fourth quarter cash flow

Sydney, 31 July 2007 – Bravura Solutions (Bravura, ASX: BVA) – a leading global supplier of wealth management applications and professional services – wishes to update investors on trading for the six month period ended 30 June 2007, and cash flows for the quarter ended 30 June 2007.

TRADING UPDATE

Bravura performed strongly in the six months to 30 June 2007. Of the forecast full year revenue of approximately $99.0 million, 68 per cent occurred in the second half of the year. Key drivers behind FY2007 revenue growth included the impact of the Rufus and AB Prodata acquisitions, and revenue from major new clients, in particular, New York Life International and Friends Provident.

Notwithstanding continuing expenditure on Research and Development (R&D), global infrastructure and integration costs, Bravura has also delivered strong earnings growth. The Board of Bravura is pleased to confirm that our EBITDA will meet or exceed our previous guidance of $13.1 million.

Bravura’s Group CEO & Managing Director, Iain Dunstan commented, “We are extremely pleased with the performance of the business during 2007. Our commitment to investing in R&D has positioned the company as a leading international supplier of software and services to the wealth management industry.

The imminent rollout of the first Sonata application module, a growing international client base and the established and robust platform acquired as part of the Rufus acquisition, all combine to position the business well for increased revenue and earnings in the future.”

Bravura expects to release its full year audited results on 29 August 2007.

QUATERLY CASH FLOW ANALYSIS

Operations
Net operating cash out flow for the quarter ended 30 June 2007 was approximately $4.1 million, resulting in overall net operating cash out flow of $4.7 million for FY2007.

Significant impacts on operating cash flow in the quarter included:

• Increase in working capital
  
  Key acquisitions - The Rufus and AB Prodata acquisitions have contribute significantly to revenue growth. Their combined revenue grew approximately 16 per cent on the preceding quarter. This revenue growth was concentrated towards the latter part of the quarter and has resulted in Rufus and AB Prodata ending the period with a combined accounts receivable balance of approximately $17.0 million.
  
  New contracts - As previously announced, Bravura has recently signed contracts with New York Life International and Friends Provident. As anticipated, Bravura has incurred significant upfront costs in scoping and implementing these new projects. At 30 June 2007 professional services work yet to be invoiced for these projects amounted to $4.7 million. In addition, these large contracts are structured so that licence fees are invoiced over a period of time, typically the life of an implementation project. Bravura expects that these licence fees will be invoiced during the course of the relevant project and paid in accordance with usual terms of 90 to 120 days.
• Ongoing R&D commitment 
  
  Bravura maintained its ongoing commitment to upgrading its Talisman and Sonata suite of wealth management applications, spending $2.2 million in the current quarter. Total R&D commitment for the full year ended 30 June 2007 was $9.6 million.

Investing activities
Bravura made its third acquisition in seven months with the purchase of Garradin Pty Limited for $9.6 million. This increased the company’s investment in new acquisitions during fiscal year 2007 to a total of $64.7 million.

The integration of the Garradin business is progressing as planned.

Restructuring
Bravura also made a significant investment by relocating the Rufus software division from the Bank of New York’s Canary Wharf premises to the re-fitted and more centrally–located London
site.

Bravura is also currently negotiating a contract with a major global outsource organisation for the relocation of the Canary Wharf data centre. A Heads of Agreement is expected to be signed within the next two weeks, resulting in considerable economies of scale over the term of the contract.

Financing
The acquisitions undertaken were financed by a combination of existing cash reserves, debt and equity.

Bravura successfully raised an additional $40.6 million by way of a rights issue which enabled the company to repay $24.5 million of debt. As at 30 June 2007, total net indebtedness was $12.6 million.

The Board has welcomed Bravura’s business momentum, generated through sizeable new contract wins and corresponding revenue streams.