Regal Partners (RPL) H1 2024 earnings summary

Executive summary

• Normalised NPAT for 1H24 was $59.0m, up 349% year-over-year, with statutory NPAT at $50.2m, reflecting strong fee growth and recent acquisitions.

• Revenue rose 212% to $148.5m, driven by strong performance fees and FUM growth, with net income for the half at $140.8m, up 196% year-over-year.

• FUM reached $12.3b at 30 June 2024, rising to $16.5b pro forma post-acquisitions of Merricks Capital and Argyle Group.

• Interim dividend increased 60% to 8c per share, fully franked, with a dividend reinvestment plan available.

• Acquisitions of Merricks Capital and Argyle Group in July 2024 accelerated diversification and scale.

Financial highlights

• Performance fees were $59.6m, up 645% year-over-year, with 70% of eligible FUM at or above high-water mark.

• Management fees for the half year were $60.6m, with total net income at $148.5m and net inflows of $0.7b in 1H24.

• Cost/income ratio improved to 43% from 58% year-over-year, with employee benefits expense at $46m and total expenses at $63.5m.

• Pro forma normalised NPAT for 1H24 (including Merricks & Argyle) would be $74.1m, $15.2m higher than reported.

• Basic EPS was 19.31c, up from a loss of 1.53c per share in the prior year.

Outlook and guidance

• Confident in maintaining positive net flow outlook, with institutional mandates under review and no diminished confidence in future flows.

• Expectation of further growth in performance fees as more FUM approaches high water marks, with over $1b in closed-end vehicles within 10% of high water marks.

• Focus remains on organic growth, product innovation, and disciplined assessment of further inorganic opportunities.

• Revenue synergies from recent acquisitions expected to be realised over time.

• Management expects further fee growth from the reduction in staff FUM rebate, potentially adding $7m in annual management fees.