Australian Ethical expects profit boost
Australian Ethical expects to more than double its six-month profit by the end of the year, provided market conditions remain the same.
The fund manager released its earnings expectations for the six months to 31 December 2013, advising that its net profit after tax should be between $0.97 million and $1.18 million, up 121 per cent on the prior corresponding period.
The growth — which is attributed to increased market returns and stronger flows to Australian Ethical products — came off a low base last year ($487,115).
"This profit expectation is based on unaudited information generated for internal management purposes to the end of October 2013 and assumes that market and business conditions remain broadly in line with current conditions," the manager said in its earnings guidance released on the Australian Securities Exchange.
The expectations include the impact of one-off employment restructure costs as well as legal costs for shareholder actions, which were not reflective of conventional recurring operations, the company said.
The listed fund manager faced a challenging period last year, when a group of shareholders challenged its funds management team and board of directors after an alleged destruction of staff morale, a decline in shareholder value and alleged increased levels of executive remuneration.
However, shareholders defeated the challenge, but the fund manager reported a 64 per cent decline in profit.
Earlier this year, the Australian Ethical board elected a new chairman and appointed new directors, and recently reached a record funds under management.
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