Pendal (ASX:PDL) posts 31% spike in revenue; how are shares responding?

Highlights

• Pendal Group reported a 31% rise in revenue to AU$362.6 million for the period ending 31 March 2022.

• Net profit after tax rose 8% from the first half of 2021 to AU$96.7 million.

• The company’s operating expenses surged 20%.

Pendal Group Ltd (ASX:PDL) has reported robust earnings for the period ending 31 March 2022, marked by healthy growth in revenue, underlying EPS and interim dividend. The asset management firm reported a 31% rise in revenue to AU$362.6 million, which was mainly powered by the acquisition of US-based investment manager Thompson, Siegel & Walmsley (TSW) and higher global equity markets.

Pendal is an Australian company engaged in the provision of investment management services.

By 10:10 AM (AEST), the stock was trading at AU$5.08, up 3.04%. The PDL share price is down  over 11 % on a year-to-date (YTD) basis. In the past one year, the stock has declined over 31%, while in the past month, it is up nearly 4%.

Net profit after tax (NPAT) rose 8% from the first half of 2021 to AU$96.7 million, Pendal said in its latest update. Earnings per share (EPS) rose 34% to 34.3 cents, while operating margin surged 5% on the previous period to 42%.

Furthermore, the company’s operating expenses surged by 20% to AU$209.6 million, including the full contribution of TSW in the period.

Dividend

Pendal’s board has jacked up interim dividend for the financial year 2022 to 21 cents per share, from 17 cents per share in 1H21.

The dividend remains within the Group’s annual payout ratio of 80 to 95% of underlying profit after tax (UPAT). The dividend will be paid to shareholders at the record date – 20 May 2022.

Sharing its outlook, the company said,” Over the past two years Pendal’s Board and management team have been focused on building a best-in-class global investment management platform with a key objective of maximising long-term shareholder returns.”

It also said that the company was focused on continuously strengthening and advancing its global distribution and operating infrastructure to ensure it was at the forefront of delivering investment and client service excellence.

Meanwhile, Pendal was in focus last month after the fund manager rejected a takeover offer from rival Perpetual as its board believed that the offer undervalued the company.

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