Fiducian reports 23% profit growth but FUA declines

Fiducian has reported a 23 per cent rise in net profit after tax (NPAT), but non fee-paying clients led to a fall in funds under advice.

In its half-year results for the six months to 31 December, the licensee said statutory NPAT was $6.8 million, up from $5.5 million at the end of December 2022. Net inflows were $121 million in the six months from aligned financial advisers.

Funds under management (FUM) grew from $4.1 billion to $4.8 billion, an 18 per cent rise.

Funds under advice (FUA) fell from $4.8 billion to $4.7 billion; the firm said there is a “long list” of non-fee paying clients.

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“We continue with the exercise of contacting a long list of non-fee paying clients to disengage completely or renew their relationship on a fee basis,” it said.

Overall funds under management, administration and advice (FUMAA) was $12.9 billion, up 9 per cent from $11.9 billion a year ago.

Its platform administration offering wrap administration for superannuation and investment services grew 13 per cent from $3 billion to $3.4 billion.

It has 80 aligned advisers and associates, and 45 offices across Australia, and said they are an “enabler of steady flows” to its funds and platform.

Indy Singh, executive chairman of Fiducian, said: “The environment has been uncertain but management has worked hard and judiciously positioned all areas of the company for future growth by utilising its vast cache of intellectual capital.

“Our people, our stakeholders and our shareholders should be beneficiaries of this positioning.”

The firm runs an in-house Manage-The-Manager system of investment, and said this attracts the majority of retail funds placed with the firm and provides a diversification benefit to investors. This includes Capital Stable, Balanced, Growth, Ultra Growth, Technology and India funds.

“Despite media forecasts of volatility and weakness to come, financial markets remained resilient amid expectations of interest rate reductions to come in 2024,” Singh added. “The sharp declines seen particularly in risk assets and fixed income securities were partially recovered. Our investment strategy to move close to benchmark by marginally reducing growth asset exposure and increasing fixed interest exposure has proven successful.”

It resolved to pay an interim fully franked dividend for the half year of 18.2 cents per share, up from 12.3 cents per share at the end of December 2022.