Australian Ethical Investment (AEF) H2 2025 earnings summary

Executive summary

• Achieved record FY25 results with strong organic and inorganic growth, disciplined strategy, and cost management amid volatile markets, focusing on ethical investment and positive societal impact.

• Funds under management reached a record $13.94 billion, up 34% year-over-year, driven by net flows, investment performance, and acquisitions including LTS Asset Management and Altius.

• Brand awareness doubled to 22%, with multiple industry awards for investment excellence, responsible leadership, and customer experience.

• Enhanced business platform through technology upgrades, key talent hires, and operational transitions to GROW Inc and State Street.

Financial highlights

• Operating revenue rose 19% to $119.4 million, supported by 31% average fund growth and partially offset by a lower average revenue margin.

• Net profit after tax increased 68% to $19.9 million; underlying profit after tax rose 29% to $23.8 million, driven by organic growth and acquisitions.

• Operating expenses grew 14% to $84.5 million, mainly from employee and fund-related costs, offset by cost savings from platform transitions.

• Cost-to-income ratio improved to 71.4% from 73.7% in FY2024.

• Dividend for the year was $0.14 per share, up 56% from FY2024.

Outlook and guidance

• Confident in sustaining organic FUM growth, underpinned by strong brand, investment performance, and dual growth engines in superannuation and non-super channels.

• Expect continued moderation in pricing, incremental improvements in cost-to-income ratio, and further reinvestment in growth opportunities.

• Anticipate full-year benefits from cost-saving initiatives and platform enhancements in FY2026.

• Medium-term opportunities include expanding fixed income, private markets, and international equities offerings.