Australian investment manager Perpetual has registered a fall in profit due to the challenging market conditions caused by the Covid-19 pandemic and outflows in its investment unit.
The firm’s statutory net profit after tax (NPAT) for the full year ended 30 June 2020 stood at $82m, a 29% slump from $115.9m a year ago.
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Revenue of $489.2m in FY20 was 5% lower than the prior year.
Perpetual Investments posted pre-tax profit of $55.4m in FY20, a decrease of 31% from the previous year.
The firm attributed the fall to drop in revenue driven by lower average FUM due to net outflows.
In Perpetual Private, pre-tax profit dropped 27% year-on-year to $30.1m.
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By GlobalDataThis was said to be driven by increased investment in business growth.
On the bright side, Perpetual Corporate Trust reported a 16% rise in profit to $55.2m.
This was said to be due to growth from existing clients as well as new client mandates across three of its business segments.
Perpetual CEO and managing director Rob Adams said: “While our increasingly diversified business has provided some protection against the extreme volatility seen in global investment markets, our overall FY20 financial results have been impacted due to COVID-19 effects and net outflows from Perpetual Investments.”
“The S&P/ASX All Ordinaries Price Index closed the year 10% lower than FY19 which had a direct impact on the Group’s market-related revenues generated by Funds Under Management (FUM) in Perpetual Investments and Funds Under Advice (FUA) in Perpetual Private in the second half. In addition, net outflows from Perpetual Investments, whilst slowing through the year, led to lower revenue for the full year.”
However, Adams is optimistic about the firm’s medium to long-term outlook.
“A number of strategic initiatives delivered in FY20 will provide further strength and diversification as well as opportunities for growth in new sectors and markets,” he said.
Recently, Perpetual agreed to acquire 75% stake in Barrow, Hanley, Mewhinney & Strauss (Barrow Hanley).
