PNI FH25--proceeding to plan--continue to like--TOP 10 Holding

 PNI FH25

SUMMARY

There was a strong FH result with flows across the board, which is unsurprising given the strength of markets. Expansion continues internationally and in private and equity markets. Core earnings growth 37%.

FUM ended much higher but mainly due to acquisitions being Antipodes' acquisition of MBA, ($9.8b) PNI acquisition of PAM ($17B) and VSS ($1.1B). There was underlying growth and PNI indicated that the marketing effort will be enhanced to meet significant demand for product.

The Performance fees (PF) were strong, a/t $36.4m of the $76m NPAT. PNI went out of its way to describe the breadth and uncorrelated nature of PF’s. Despite this, Hyperion had an outstanding year in PF.

The main growth drivers remain, international (equity and other), Retail and broader private markets. Institutional Domestic Equities remain challenged (industry funds!)—almost everything else is positive.

Management stated that there was further evidence that the “Pinnacle Model” could be exported to larger addressable international markets. That there was a diverse pipeline of opportunities offering multiple sources of earnings contributions. There was no shortage of high-quality funds approaching PNI.

The net cost of Horizon 2 (funding new strategies was $4.5m, flat on the last half.

BP ex-PF were lower and probably reflect the mix of new business, the acquisition of MBA, and high margin affiliate fees are 2H weighted. Management highlighted that margins are expected to increase in the 2H, and into FY26. The increasing weight of high-margin retail and international FUM should drive the bp margin higher.

the recent capital raise was more than required so will see more M&A.

Management commented about the negative news flows on private credit (credit losses and debt for equity swaps) and expressed confidence in Metrics management but warned the industry was due for some volatility, especially newer players but it was expected to exhibit strong growth.

 




















                                                                                



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