The IOOF Holdings Limited (ASX: IFL) share price has risen around 7% after it released its June 2019 Funds under Management, Advice and Administration (FUMA) update.
IOOF Holdings is a diversified financials business that offers a variety of services to clients including financial advice, platform management & administration, investment management and trustee services. IOOF has been operating since 1846 and is now one of the largest financial services industry businesses.
Why The IOOF Share Price Rose Today
The diversified financials business reported Funds under Management, Advice and Administration (FUMA) of $149.5 billion at June 2019.
This was an increase of 18.7%, or $23.6 billion, compared to a year ago. Without the acquisition of the ANZ Wealth aligned dealer group funds grew by 5.9%, or $7.5 billion.
IOOF broke down the net flows by segment for the quarter to 30 June 2019. Portfolio & Estate Administration experienced a net inflow of $561 million, although the prior comparative period had a net inflow of $666 million. Financial advice saw a net inflow of $432 million against the prior corresponding period net inflow of $2.5 billion which included a one-off large client transfer of around $2 billion. That means both of these segments had less inflows than last year.
The other segment, Investment Management, experienced a net outflow of $181 million compared to a net inflow of $130 million last year. Ouch.
IOOF CEO Renato Mota said: “This has been our best quarter of inflows recorded across IOOF’s platforms and financial advice businesses since June 2018. Pleasingly it demonstrates the strong organic growth momentum achieved in a challenging year for the industry.
“In a year which has seen the reputation of the sector challenged, many of our competitors have suffered significant net outflows. IOOF’s emphasis on the value of financial advice, putting our clients first and resetting our organisational culture has translated into strong business performance for the quarter.”
Is IOOF A Buy?
IOOF has certainly done well this quarter. If it can keep growing FUMA and profit over the long term then it could be worth buying today, but it’s hard to predict IOOF’s future so I’d rather just leave it on the side.
I think the shares in the free report below could be better investments for my portfolio.
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