The Australian Ethical Investment Ltd (ASX: AEF) share price has burst out of the gates on Thursday.
In morning trade, the ASX 300 financial stock is up 22% to a 52-week high of $6.19.
This follows the release of the company's half year results, which revealed a record performance.
ASX 300 financial stock jumps on record half year results
- Operating revenue up 21.2% to $58.8 million
- Funds under management (FUM) revenue up 22% to $54.7 million
- Underlying profit after tax up 35.3% to a record of $11.5 million
- Interim dividend up 67% to 5 cents per share
What happened during the half?
For the six months ended 31 December, the ASX 300 financial stock reported a 21% increase in total revenue to $58.8 million. Management advised that this was driven by average FUM growth which was underpinned by continued positive net flows, positive investment performance, and the acquisition of the Altius business.
With operating expenses growing slower than revenue at 14%, things were even better on the bottom line. Australian Ethical reported a 35% increase in underlying profit after tax to a record of $11.5 million and underlying earnings per share lifted 34% to 10.11 cents.
This allowed the company's board to increase its fully franked interim dividend by 67% to 5 cents per share.
'Strong momentum'
The ASX 300 financial stock's CEO, John McMurdo, is confident that the strong momentum experienced in the first half will continue into the second half. He said:
We are seeing strong momentum which I expect to continue into the second half of the year, as we bed down our new super administration platform, and retain focus on our strategic priorities. I anticipate continued growth in brand awareness and superannuation net flows post transition to GROW as we recommence our marketing activity.
McMurdo also spoke about its revenue margins, expenses, and the future. He adds:
During the second half, revenue margins are expected to stabilise, and employment expenses are moderating following the completion of the acquisition of the Altius business in late September 2024. We will also benefit from the full run rate of the improved commercial rate cards following our superannuation administration and custody transitions.
I'm excited about the period ahead of us. We are well positioned with a strong balance sheet, highly capable team, enhanced business platform, unique brand and deep ethical pedigree.
No earnings guidance has been provided for FY 2025.
