HMC Capital (HMC) H2 2024 earnings summary

Executive summary

• Achieved record financial results in FY2024, with 40% growth in pre-tax EPS to 37.0cps and 30% AUM growth to AUD 12.7 billion, driven by new revenue streams and platform diversification in private credit, energy transition, and digital infrastructure.

• Five-year annualized shareholder return since listing is 29%, reflecting high ROE and recurring revenue streams.

• Maintained a net cash position, AUD 1.4 billion in net tangible assets and undrawn debt, and AUD 2.5 billion in dry powder.

• Achieved strong platform diversification supported by strategic hires and acquisitions.

Financial highlights

• Total revenue rose 42% to AUD 189.5 million, with a 14% rise in management fees and a 60% increase in investment income year-over-year.

• Operating margin increased to 68%, aided by a AUD 15.6 million performance fee.

• Pre-tax EPS of AUD 0.37, up 40% year-over-year.

• Final dividend of AUD 0.06 per share, 70% franked; FY2025 dividend guidance is AUD 0.12 per share.

• No debt drawn as at 30 June 2024; gearing at 1.8%.

Outlook and guidance

• Expectation to sustain operating margin above 60% and continued strong operating EPS growth, underpinned by five scalable platforms.

• Private credit AUM targeted to double in FY2025, with strong momentum from Payton acquisition.

• Real estate transactional activity and investor appetite expected to increase as rates ease.

• Deep transaction pipeline in digital infrastructure, energy transition, and private equity, with potential for outsized profit events.

• FY2025 dividend guidance maintained at 12cps, with retained earnings reinvested for growth.