Pendal has seen a 42% rise in statutory net profit after tax (NPAT) while performance fees have risen more than 100% in the firm’s latest annual results.
In its results, announced to the Australian Securities Exchange, for the 12 months to 30 September, 2021, the firm said statutory NPAT increased by 42% to $164.7 million from $116.4 million at the end of September 2020.
This reflected growth in fee revenue on increased funds under management (FUM) and favourable mark-to-market movements on the group’s seed investments, it said.
FUM increased to $139.2 billion, this was mostly the result of Pendal’s acquisition of investment manager TSW in the US and a $16 billion contribution from higher markets and investment performance.
However, there had been $2.9 billion in outflows in the institutional and sub-advised channels during the 12 months as “clients took the opportunity to rebalance portfolios and take profits following the significant market appreciation through the year”.
Fee revenue rose 23%, this comprised of a rise from $458.1 million to $522.8 million in base management fees and a rise from $13.4 million to $57.5 million in performance fees, a performance fee jump of more than 100%.
There had been “significant outperformance” in UK, European, Asia ex Japan and emerging market strategies while the Australian equity strategies performed strongly, particularly the MicroCap and Focus Australian equity strategies.
The board declared a final dividend of 24 cents per share (cps) which brought the total dividend for the financial year to 41 cps, an 11% increase on FY20.
Pendal Group chief executive, Nick Good, said: “With the strongest 12-month growth in global equity markets for 30 years, Pendal’s scale and diversified global business means we have been well positioned to benefit, delivering a significant increase in FUM, revenue, profitability and shareholder returns.
“As a business, we have made important strides during the year to better position us to take advantage of emerging opportunities and drive efficiencies, in order to deliver long-term shareholder value.”