Netwealth earnings up despite surge in FUA, FUM outflows

netwealth/funds/platform/technology/flows/

16 February 2023
| By Charbel Kadib |
image
image
expand image

Netwealth has published its results for the first half of the 2023 financial year (1H23), reporting an underlying net profit after tax (NPAT) of $30.6 million, up 11.4% from $27.5 million in the previous corresponding period.

The result was supported by 18% growth in platform revenue, up from $84.6 million to $99.8 million over the same period.

The group’s total operating income rose 18.8%, from $86.5 million in 1H22 to $102.8 million in 1H23.

The income boost was offset by a 27.2% increase in total operating expenses, from $44.5 million to $56.6 million.

Netwealth also reported 10.2% growth in funds under administration (FUA), up from $55.6 billion to $62.4 billion.

This was despite a surge in net outflows, which rose  47.1% from $2.5 billion in 1H22 to $3.7 billion in 1H23 — offset by a 13.9% increase in FUA inflows to $8.7 billion.

As a result, net flows were down 32% to $5 billion.

Growth in Netwealth’s total funds under management (FUM) were also weighed down by a 30.8% contraction in net inflows to $1.2 billion.

Total FUM grew 4.5% relative to 1H22, closing 1H23 at approximately $14.4 billion.  

Netwealth maintained its net inflows guidance for FY23 at $11 billion, subject to “timing of transitions” and “no further deterioration” in the macro and geopolitical environment.

“After a period of increased investment in our people, resources, and technology, our focus is now and driving productivity, efficiency, and operating leverage, which are important for ensuring sustainable growth and profitability,” Netwealth noted.

Netwealth is expecting its non-headcount expenses for 2H23 to remain in line with its 1H23 result, and is forecasting further employee growth over the period.

 

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

So we are now underwriting criminal scams?...

2 months 3 weeks ago

Glad to see the back of you Steve. You made financial more expensive, not more affordable as you claim, and presided ...

2 months 3 weeks ago

Completely agree Peter. The definition of 'significant change is circumstances relevant to the scope of the advice' is s...

4 months 4 weeks ago

ASIC has suspended the Australian Financial Services Licence of a Melbourne-based financial advice firm....

1 week 5 days ago

The corporate regulator has issued infringement notices to three AFSLs whose financial advisers provided personal advice to a retail client while unregistered....

2 weeks 3 days ago

ASIC has released the results of its first adviser exam to be held in 2025, with 241 candidates attempting the test....

3 weeks 1 day ago

TOP PERFORMING FUNDS

ACS FIXED INT - AUSTRALIA/GLOBAL BOND