The GQG Partners Inc (ASX: GQG) share price is down more than 1% after reporting its HY24 result.
GQG is one of the larger fund managers on the ASX, it’s based in the US.
GQG FY24 half-year result
Here are some of the highlights from the first six months of GQG’s 2024 financial year:
- Average funds under management (FUM) rose 46.5% to $139.5 billion
- Net revenue increased 53.1% to $363.1 million
- Distributable earnings grew 53.7% to $209.9 million
- Net profit after tax (NPAT) increased 56.4% to $201.2 million
- Total dividends per share rose 46.3% to $0.0566
During the half-year period, the business experienced $11.1 billion of net inflows for the period, which as a strong tailwind for its FUM growth. Each of its main investment strategies have beaten their respective benchmarks over a five-year period by an average of at least 4%.
That investment performance is an important element of retaining and attracting more client funds, whilst also being an organic tailwind for FUM growth.
Its revenue is significantly derived from asset-based fees rather than performance fees, so the FUM growth is very helpful for the company’s financials and ultimately for the GQG share price.
Management commentary
The GQG CEO Tim Carver said:
Our financial results were driven in large part by our investment performance over the long-term. As at the end of June 2024, our strategies continued to generate solid relative returns with lower volatility compared to their benchmarks, which we believe provides the foundation for continued business success.
We believe our positive net flows of US$11.1 billion during the first half of 2024 reflect our clients’ trust in our approach, driven by the consistency of our long‑term returns
Final thoughts on the GQG share price
GQG is expecting more positive flows in 2024, with a “reasonable pipeline of client demand across multiple geographies and channels.”
The GQG share price is up more than 70% over the last year, it has performed strongly for shareholders. The large and growing dividend is very useful for investors focused on investment income.
I think GQG is a great business, though it’s not as good value as it was last year – the market seems aware of the company’s prospects. I’d be very happy to own GQG shares, but it may be best to wait for a lower price, which may come when the market goes through some volatility.
