Why Pinnacle’s (ASX:PNI) FUM plummeted in FY22

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Highlights

  • Pinnacle’s FUM fell for the first time in ten years in FY22.

  • Pinnacle Investment reported a 6% dip in FUM to AU$83.7 billion.

  • Net profit after tax was up 14% at AU$76.4 million.

Pinnacle Investment Management Group Ltd (ASX:PNI) on Wednesday announced a fall in its funds under management (FUM) due to difficult stock market conditions in the second half of the financial year 2022. The investment management company reported a 6% dip in FUM to AU$83.7 billion in its financial results for the financial year ended 30 June 2022, compared to US$89.4 billion in the prior year.

It is for the first time that the Australia-based multi-affiliate investment management firm has reported a decline in its FUM. Over the last ten years, the ASX-listed company had reported a compound annual growth rate in FUM of nearly 24%.

Highlights from Pinnacle’s FY22 results

  • Net profit after tax (NPAT) attributable to shareholders rose 14% to AU$76.4 million from the prior financial year.
  • Basic earnings per share (EPS) attributable to shareholders surged 5% to 40.2 cents from 38.2 cents in FY21.

Meanwhile, the company reported net inflows of AU$0.6 billion in the full year. Pinnacle Investment reported inflows of AU$2.2 billion in the six months ended 30 June 2022.

The company said that retail net inflows have continued to be positive during FY22. But after hitting a record AU$2.9 billion in 1H, the inflows are much lower at AU$0.7 billion in 2HFY22.

Dividend announcement

The board of the ASX-listed financial stock also a declared a fully franked final dividend per share of 17.5 cents.

With this, the total fully franked dividends for FY22 stand at 35 cents, up 22% from the fully franked total dividend of 28.7 cents in the last fiscal.

What did Pinnacle’s management say?

Commenting on the results, Pinnacle’s managing director and founder Ian Macoun said, “Following the record retail inflows in the first half of the 2022 financial year, net inflows for the second half fell below our expectations as we confronted difficult market conditions.”

“We have continued to invest in our distribution capabilities, particularly retail and offshore, to ensure that we are well positioned to continue to grow and broaden our market share,” he added.


 


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