Magellan, which had $115 billion in funds under management in mid-2021, said that number had fallen another $3.9 billion to $35.8 billion as of December.
While the outflow of funds has continued, Formica said the pace of declines was getting “better and slower” on the back of the firm’s stronger investment performance.
Magellan’s flagship global fund returned 3.3 per cent, below its benchmark, in the six months to December, but at the end of January this year exceeded its benchmark, with a 10 per cent return. The company’s net profit fell 5 per cent to $93.5 million in the December half, but its profit excluding one-off costs and strategic expenses jumped 24 per cent to $104.1 million.
Formica, who joined Magellan in 2023 as a non-executive chairman, said his job over the past six months included “getting a bit of urgency” into the decisions that had already been made to turn the company around.
Looking ahead, he said Magellan’s balance sheet, including $800 million in capital, would give Rahmani the flexibility to fund new business strategies of people brought into the company and to buy boutique firms, but that the pathway would be shaped by her.
“Her stamp will definitely be over the deals we do and the areas we move into,” he said.
Having been appointed executive chairman in October last year, Formica will revert to his non-executive chairman role once Rahmani is appointed chief executive.
The company announced an interim dividend of 29.4 cents a share, 50 per cent franked, which is payable on March 6.
The Market Recap newsletter is a wrap of the day’s trading. Get it each weekday afternoon.
Source Agencies
