Shares in Qualitas Ltd (ASX: QAL) are trading more than 5% higher after the company announced a significant jump in revenue and net profit.
The alternative investment manager said in a statement to the ASX on Tuesday that funds management revenue had come in at $42.7 million, up 38%, while normalised net profit was up 30% to $21.2 million for the first half.
The company said the first half of the year was "a standout period of accelerated growth in fee related recurring earnings, driven by higher base management and transaction fees, together with improved platform efficiency''.
Qualitas added that investment activity hit new highs, with $3.7 billion deployed during the half, up 57% compared with the same period in FY25.
Fee earning funds under management was up 38% to $10.9 billion.
The company added:
Operational leverage from prior platform investments, combined with disciplined cost management, drove a record gross operating margin of 46%, the highest since IPO. Net performance fee revenue increased by 75% on 1H25, reflecting strong credit funds' performance, with $12 million of previously accrued performance fees received in cash during the period.
The company also said it had increased its fully-franked interim dividend from 2.5 cents per share to 3.5 cents.
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Management optimistic
Qualitas Managing Director Andrew Schwartz said it was a solid result.
He added:
Qualitas achieved key milestones in capital raising and deployment in 1H26, securing new mandates from offshore pension funds and increased allocations from existing investors, despite a moderating capital raising environment. This underscores our proven investment track record and further reinforces our standing with global institutional investors. Deployment reached record levels despite more market entrants, highlighting the structural barriers to scale and sustainable profitability in the sector. Opportunities are shifting towards larger investments, with approximately 78% of FY26 year-to-date closed and pipeline deals over $100 million, including seven above $200 million. This trend boosts investment efficiency and sustainable growth.
Mr Schwartz said increased regulatory scrutiny for the sector would be a positive for Qualitas, with some players likely to withdraw from the sector.
On the outlook, the company said it was starting the year on a positive footing.
It added:
Following a strong first half, we are well positioned for continued growth in 2H26, underpinned by enhanced earnings visibility. Strong investment activity supports half-on-half growth in base management fees and drives higher principal income through increased co-investment drawdowns, further supported by the recent rate rise. Performance fees from our credit funds are expected to increase, reflecting strong deployment across credit strategies, with recognition and cash receipts becoming increasingly consistent as these funds mature.
Qualitas shares jumped 6.7% in early trade before settling back to be 4.8% higher at $3.24.
Qualitas was valued at $931.4 million at the close of trade on Monday.
