Treasury Group net profit jumps 50 per cent-plus
A 54 per cent increase on last year’s figures in Treasury Group’s net profit after tax (NPAT) has been driven by significant inflows into its RARE, IML and Celeste Funds.
The group banked $10.4 million NPAT and $10.6 on an underlying basis - an increase of 32 per cent from the previous 12 months. It represented a 5 per cent growth ($0.8 billion) in funds under management (FUM) to $17.1 billion.
Growth in FUM was due to stronger market conditions, the realisation of reduced costs and the performance of RARE, IML and Celeste Funds which received $1.7 billion net in funds inflows compared to $0.9 billion in the previous year.
Treasury Group said retail funds inflows into the three funds was driving a shift in its overall FUM towards higher margin retail, leading to an average net margin (excluding Trilogy) of 55 basis points - a 7.8 per cent improvement on the 51 basis points average net margin in 2012.
The fund’s success offset significant funds outflow from low institutional mandates from Orion Asset Management, although Treasury Group said it continued to be a profitable business with over $3.4 billion FUM.
It said impressive performance had led the board to increase fully franked dividends by 15 per cent to $0.23 a share.
“The increase in the full year dividend evidences the Board’s confidence in the company’s financial position and foreseeable operating outlook,” Treasury Group chairman Mike Fitzpatrick said.
Following the announcement of the group’s performance, stockbroker Ord Minnett said it continued to rate the group a 'buy’. IML and RARE would experience operating leverage off the back of improved FUM balanced, it said, forecasting 2014 growth earnings at 17 per cent and valuing shares at $10.72 a piece.
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