Petershill Partners (PHLL) H1 2024 earnings summary

Executive summary

• Achieved strong H1 2024 results with double-digit growth in fee-related earnings and robust asset raising, especially in private equity, despite a challenging industry environment.

• Executed several acquisitions and disposals, increasing focus on private market strategies and enhancing earnings quality.

• Returned $222 million to shareholders through dividends, buybacks, and a tender offer, including a special dividend linked to the LMR Partners disposal.

• Partner-firm investment performance remained strong, with realized net IRRs outperforming benchmarks and 80% of AUM performing in the upper half or above.

• Maintained a stable balance sheet with high cash flow conversion and substantial cash available to support further M&A and capital returns.

Financial highlights

• Aggregate AUM grew to $332 billion, up 11% year over year; fee-paying AUM rose 21% to $238 billion.

• Partner FRE increased 13% year over year to $112 million with a 58% margin; partner distributable earnings up 12% to $140 million.

• Adjusted profit after tax was $94 million, up from $68 million in H1 2023; adjusted EPS rose to 8.5 cents (from 6.0 cents in H1 2023); adjusted tax rate 15.9%.

• Gross management fees from private markets were $202 million, up 16% year over year.

• Free cash flow conversion was strong at 122%-123% (1H 2023: 105%).

Outlook and guidance

• Reiterated 2024 guidance: $20-25 billion organic gross fee-eligible AUM raise, $5-10 billion realisations, and $200-230 million full-year partner FRE.

• PRE expected at 15-30% of total partner revenues; adjusted EBIT margin guidance of 85-90%.

• Medium-term M&A guidance maintained at $100-300 million per annum.