Australian Ethical Investment (AEF) H2 2024 earnings summary

Executive summary

• Achieved record FY24 results with 24% revenue growth, surpassing AUD 100 million in revenue and AUD 10.4 billion in FUM, driven by organic growth and successful integration of Christian Super.

• Underlying profit rose 57% year-over-year to AUD 18.5 million, and statutory NPAT increased 80% to AUD 11.8 million, despite a non-recurring AUD 2.16 million write-down on Sentient Impact Group.

• Maintained over 40 consecutive quarters of positive net flows, with net flows up 30% year-over-year, and continued strong customer retention and brand recognition, receiving multiple industry awards.

• Announced acquisition of Altius Asset Management, expected to add AUD 2 billion in FUM, expand fixed income capability, and be immediately EPS accretive.

• Declared a record full-year dividend of AUD 0.09 per share, up 29% from the prior year.

Financial highlights

• Revenue grew 24% year-over-year, reaching AUD 100.5 million, with a 20% CAGR over five years.

• Underlying profit was AUD 18.5 million, up 57%; statutory NPAT was AUD 11.8 million, up 80%.

• FUM reached AUD 10.4 billion, up 13% from June 2023, tripling from AUD 3.4 billion five years ago, with a 25% five-year CAGR.

• Net flows totaled AUD 607 million, primarily from resilient super net flows.

• Cost to income ratio improved to 74% from 79% year-over-year.

Outlook and guidance

• Confident in sustaining strong growth, with further profit growth expected in FY 2025 and beyond, supported by new revenue streams, cost efficiencies, and the Altius acquisition.

• Altius acquisition and platform transitions expected to deliver revenue uplift, unit cost reductions, and annualised EBITDA uplift of AUD 1 million in FY 2025.

• Continued focus on expanding asset classes, including private markets and international equities, and ongoing investment in technology.

• Medium-term growth opportunity remains strong, supported by superannuation guarantee increases and demand for responsible investing.