Australian Ethical share price jumps 6% on strong FY24 half-year result

The fund manager reported a lot of green numbers in its HY24 result.

| More on:
A businesswoman looks out a window at a green, environmental project.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Australian Ethical Investment Ltd (ASX: AEF) share price is up 6% after reporting strong profit growth in the FY24 first-half result.

It opened 1.4% higher at $4.95 and it's currently trading at $5.21.

Australian Ethical share price rises on exciting profit growth

The company saw its funded customer number increase 13% to more than 130,000, while superannuation members increased by 16%.

Net inflows amounted to $259 million, an increase of 39% compared to the prior period. This was supported by superannuation net inflows of $269 million.

The company said its continued positive net inflows during challenging market conditions demonstrates the "resilience" of its business.

The investment performance added $0.2 billion to its FUM over the period.

What else happened in the FY24 first half?

Australian Ethical launched three investment products. The Infrastructure Debt Fund was launched, as well as two multi-asset products, being 'moderate' and 'conservative' funds.

The fund manager pointed out that the business operating leverage is improving. The underlying cost-to-income ratio for the period was 75%, an improvement from the FY23 first half of 81%. Increasing profitability can help give investors more confidence about paying more for the Australian Ethical share price.

What did Australian Ethical management say?

The Australian Ethical CEO John McMurdo said:

Our growth strategy is gathering momentum and we are seeing an uplift in our key financial metrics as well as strong momentum on key strategic initiatives. We are proud of the way we operate our purpose-driven business and were delighted that many aspects of our business – customer experience, growth, governance, investment philosophy as well as investment excellence – were all recognised by awards and accolades during the period.

What's next for Australian Ethical?

The business is targeting $100 million of annualised revenue by the end of FY24. It generated $47.5 million in revenue in the first half of FY24.

It said its larger scale will allow the business to invest for growth while also delivering profit for shareholders. It's planning to invest in technology and data analytics, as well as the customer experience.

The company revealed it's considering a pipeline of 'inorganic' opportunities.

Australian Ethical share price snapshot

In the last six months, Australian Ethical shares have risen by 27%, compared to a 7% rise for the S&P/ASX 200 Index (ASX: XJO).

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Australian Ethical Investment. The Motley Fool Australia has recommended Australian Ethical Investment. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Earnings Results

Delighted adult man, working on a company slogan, on his laptop.
Earnings Results

Bank of Queensland share price leaps 6% on improving outlook

ASX 200 investors are bidding up the Bank of Queensland share price on Wednesday.

Read more »

Photo of two women shopping.
Earnings Results

Premier Investments share price jumps 9% on results and demerger plans

The Smiggle and Peter Alexander owner has released its results. How did it perform?

Read more »

A man holds his hand under his chin as he concentrates on his laptop screen and reads about the ANZ share price
Earnings Results

Soul Patts share price struggles on falling profits

ASX 200 investment house Soul Patts reported its half year results this morning.

Read more »

a biomedical researcher sits at his desk with his hand on his chin, thinking and giving a small smile with a microscope next to him and an array of test tubes and beackers behind him on shelves in a well-lit bright office.
Earnings Results

Chemist Warehouse merger target Sigma reports 149% FY24 profit jump

This could be the last set of results from Sigma as we know it if its merger is approved.

Read more »

A man holds his head in his hands, despairing at the bad result he's reading on his computer.
Earnings Results

Brickworks share price tumbles on disappointing half-year loss

This loss didn't stop the company from increasing its dividend again.

Read more »

A man sits on a bench atop a mountain with a laptop, making investments with a green ESG mind.
Earnings Results

ASX All Ords stock KMD tumbles as interim dividend cancelled

Investors are hitting the sell button on ASX All Ords stock KMD today.

Read more »

Coal miner holding a giant coal rock in his hand making a circle with his hand, symbolising a rising share price.
Energy Shares

New Hope share price charges higher despite profit crunch and huge dividend cut

Weaker coal prices have hit this miner's profits and dividend hard.

Read more »

A Chinese investor sits in front of his laptop looking pensive and concerned about pandemic lockdowns which may impact ASX 200 iron ore share prices
Earnings Results

Liontown share price tumbles 7% on half-year results

This lithium developer's results have been released this afternoon.

Read more »