Magellan Financial Group has announced it will be resuming its buyback program.
In an ASX statement, the asset manager said it considered the decision to be an “appropriate deployment” of its capital in light of its current market price.
Shares in Magellan are currently trading at $8.28 as of 3 March, but are down by 25 per cent since the start of the year and by 82 per cent over the past five years.
“Magellan Financial Group Ltd advises that in light of MFG’s current market price, it considers that the purchase of MFG shares represents an appropriate deployment of its capital.
“MFG continues to have a strong capital position and a focus on creating long-term shareholder value, and therefore intends to resume purchases under its current on-market share buyback program having regard to business and market conditions.”
There are a maximum of 3,066,413 Magellan shares remaining under the current share buyback program, it said.
In the firm’s half-year results for FY25 last month, it said no further purchases of Magellan shares were expected to be made under the on-market buyback as it had already acquired 6.9 million shares for $70.6 million.
Speaking at the annual general meeting in October 2024, executive chairman Andrew Formica said: “To date, we have bought back approximately 7 million shares since inception of the buyback of which approximately 2 million were bought back in August and September [2024] at an average purchase price of $9.23.”
Looking at the broader results, it said statutory net profit after tax was $94 million, down 10 per cent from $104.1 million in the first half of FY24.
Assets under management were $38.6 billion which the firm attributed to investment performance and favourable market movement rather than new fund flows.
Some 58 per cent of this is institutional and 42 per cent is retail. This consists of $14.5 billion in global equities, $16.6 billion in infrastructure equities, and $7.5 billion in Australian equities.
Revenue was $129,828, down slightly from $131,243 at the end of 2023, which mostly came from management fees of $121,048.
Formica said: “We are confident in our continued ability to rebuild and grow. With a new executive leadership structure in place and a clear focus on our strategic priorities, we are well-positioned to capitalise on opportunities and deliver sustainable growth.”
