Magellan Financial Group Releases FUM Update as on 31 January 2019

MFG

The investment management company, Magellan Financial Group Limited (ASX: MFG) generates attractive returns for its clients by making investments in global equities and global listed infrastructure. On 7 February 2019, the company provided an update on its Funds Under Management (FUM). Following this news, the share price of MFG increased by 1.119% on 7 February 2019.

As at 31 January 2019, the company had total Funds Under Management (FUM) of A$72,950 million which is higher than A$70,782 million as at 31 Dec 2018. In January 2019, the company witnessed a net inflow of $317 million, which included net retail inflows of $110 million and net institutional inflows of $207 million.

The company is going to announce its results for the six months ended 31 December 2018 on Thursday, 14 February 2019 at a teleconference briefing in which CEO Dr. Brett Cairns and CFO Ms. Kirsten Morton will be present. 

In FY 2018, the company reported a Profit after tax of $211.8 million which was 8% higher than the previous corresponding period (PCP). The company reported Profit after tax before MGG net offer costs and amortization of $268.9 million which was 37% higher than PCP.

At the end of FY 2018, the company had Net tangible assets of $515 million and Cash and liquid assets of $445.5 million. During the year, the company undertook a review of its ongoing capital requirements of the Group and concluded that the company has a very strong balance sheet and its business requires limited capital to support its business and to grow organically.

During the year, the Board revised the dividend policy and increased the payout ratio to 90-95% and declared a total dividend for the 2018 financial year of 134.5 cents per share which was 57% higher than the prior year.

During FY 2018, the company acquired 100% of Frontier Partners Inc, a registered investment adviser and acquired 100% of Frontegra Strategies LLC, a registered broker-dealer. During the year, the company also acquired 100 percent of Airlie Funds Management Pty Limited.

The Revenues for the year ended 30 June 2018 increased by 30% to $428.7 million as compared to the prior year. The increase in the revenue was driven by a 27% increase in total management fees revenue as a result of a 29% increase in average funds under management over the period attributable to strong investment performance, net inflows and the acquisition of Airlie in March 2018.  At 30 June 2018, the Group had FUM of $69.5 billion, split between global equities (76%), infrastructure equities (15%) and Australian equities (9%).

Average funds under management for FY 2018 stood at $59.0 billion which is 29% higher than PCP. The Net inflows for the year were $4.4 billion out of which $1.6 billion was attributable to the MGG offering.

In the past six months, the share price of the company increased by 18.97 percent as on 6 February 2019. MFG’s shares traded at $28.920 with a market capitalization of circa $5.06 billion as on 7 February 2019.


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