IOOF Holdings Limited (ASX: IFL) has reported that its funds under management, advice and administration (FUMA) went up in the first quarter of FY21.
IOOF’s first quarter of FY21
The diversified financial business said that its FUMA went up by $529 million to $202.8 billion over the quarter.
Let’s look at the net inflows for individual segments.
The financial advice division saw $110 million of net inflows. The portfolio and estate administration segment experienced $226 million of net inflows. Investment management suffered $62 million of net outflows. IOOF’s pension and investments (P&I) division (which it recently acquired) suffered a $411 million net outflow which was consistent with the outflows under the previous owner.
The company continues to integrate the P&I business and it’s preparing for the completion of the MLC acquisition. Chris Weldon has been appointed the chief transformation officer.
IOOF CEO Renato Mota said: “We are at an inflection point of change for the Australian advice landscape. The value of quality financial advice has never been more apparent than it is today. Equally, the need to create a professional business model has never been more apparent.
“Building a business model that is sustainable in its own right, without economic subsidisation and allowing for ongoing investment in technology and processes is critical in ensuring that financial advice is more affordable and available to more Australians.”
IOOF is undergoing a big change with its two acquisitions, particularly MLC. If IOOF manages to turn its acquisitions into high quality, reasonably priced advice businesses that are always doing best by the client, then it could be a contrarian buy idea today.