Super offsets managed fund outflows at Australian Ethical
Australian Ethical has reported a 15 per cent rise in funds under management (FUM) as it scales up the business to benefit from a mega trend of responsible investing.
In its results for the six months to 31 December, the firm said net profit after tax (NPAT) was $6.2 million, up from $1m in the first half of 2023. Revenue was $48.5 million, and the firm said it is targeting $100 million in annualised revenue by the end of FY24, subject to market conditions.
Funds under management were $9.6 billion, up 15 per cent, thanks to total net flows of $259 million as well as positive investment performance. Some 41 per cent of this is in its domestic equities funds with 23 per cent in international equities.
Flows were specifically underpinned by resilient inflows of $270 million into superannuation, where it acquired Christian Super in November 2022, which offset outflows of $10 million from its managed fund arm.
The managed fund outflows compared to inflows of $7 million in the prior corresponding period; Australian Ethical attributed this to cautious investor sentiment during volatile market conditions.
In superannuation, it noted the higher Super Guarantee contributions – which rose from 10.5 per cent to 11 per cent in July 2023 – had helped to offset outflows from ex-Christian Super members. Average super balances for its members was $64,000 with an average age of 39.
It also noted the size of the advised channel “is now material” at 17 per cent, although the majority come from direct investors.
It also launched two multi-asset funds during the period and has since launched its first private debt fund in February 2024.
“Our diversified product set and continued growth in super member numbers has underpinned positive net flows during challenging market conditions.”
A mega trend towards responsible investing is on the horizon, it said, creating a significant potential addressable market for the firm and has been scaling up the business accordingly.
Chief executive, John McMurdo, said: “Our growth strategy is gathering momentum and we are seeing an uplift in our key financial metrics as well as strong momentum on key strategic initiatives.
“It is encouraging to continue reporting positive net flows and solid investment performance during a period of continued market volatility. As a result, we continue to see growth in our revenue and remain enthusiastic about the opportunities that lie ahead.”
AUTHOR
Laura Dew
Recommended for you
Platinum Asset Management has put its two closed-end funds under strategic review in a bid to reduce the share price discount to pre-tax NTA and maximise shareholder value.
In the latest Meet the Manager profile, Money Management speaks with Michael Skinner, founder and managing director at Blackwattle Investment Partners.
Perpetual has seen AUM rise 6 per cent in the last quarter but the departure of a longstanding JOHCM fund manager led to outflows of $2.2 billion from his strategy.
Global fixed income fund Bentham Global Opportunities has been added to several major platforms, enabling it to be accessed more easily by financial advisers.
Add new comment