The GQG Partners Inc (ASX: GQG) share price is up more than 4% after reporting a strong FY24 result.
GQG is a fund manager offering a number of investment strategies including global shares, emerging markets, international shares and US shares.
FY24 result
The funds management company reported its result for the 12 months to 31 December 2024:
- Average funds under management (FUM) rose 45.4% to US$148.2 billion
- Net revenue increased 46.9% to US$760.4 million
- Net profit up 52.8% to US$431.6 million
- Distributable earnings up 50.4% to US$447.9 million
- Dividends per share up 50.2% to US$0.1367
After a turbulent last few months, the company said it experienced net flows of US$20.2 billion for the full-year ending 31 December 2024.
Despite the Adani issues, the company’s closing FUM was 26.9% higher at US$153 billion.
The company benefited from a strong year for the global share market, which delivered a return of approximately 30%. This is a good tailwind for the GQG share price.
Management comments
The company highlighted that its main investment strategies have outperformed their benchmarks over the long-term and that it has decided to change the potential dividend payout ratio to between 50% to 95% of distributable earnings, compared to 90% of distributable earnings previously.
Tim Carver, CEO and Executive Director of GQG Partners, then said:
We continue to offer what we believe are very attractive fees relative to our competition. Our weighted average management fee for the 12 months ended 31 December 2024 was 49.6 bps, which we believe to be very competitive. As a result, we may be less likely to face margin pressure in the future relative to peers with higher average management fees.
In addition, more than 96% of our revenues in 2024 were derived from asset-based fees, which we expect to exhibit more stability in periods of market volatility. Less than 4% of our revenues were derived from performance fees.
GQG continues to see solid business momentum in a variety of geographies and across channels. As at 31 January 2025, our FUM totaled US$160.4 billion, which is a high water-mark for our business, and we have experienced estimated net flows of US$1.7 billion for the 2025 year to date period through 31 January.
As I look forward into 2025, I see strength in the key measures of health for our business. Of course, given volatility in markets, changes in asset allocation by investors, and the overall geopolitical environment, we may well face headwinds, but we will fight the headwinds and continue to invest and reinvent ourselves. I am delighted with the efforts from our team. I believe our culture is strong, and our clients have enjoyed solid performance in their GQG portfolios. We see substantial opportunities for the business in the years ahead and are energised to try to capture them. Thank you for your trust, and for joining us on the journey.
Outlook for the GQG share price
The company saw net flows of US$1.7 billion in January 2025 and it ended the month with FUM of US$160.4 billion. This gives it a strong base for another good year in 2025.
The GQG share price has gone up close to 20% since the start of the year, so it’s not as cheap as it was. But, the outlook is promising with a return to good inflows and its investment returns remain strong. I’d call it a solid medium-term buy, but there could be volatility in the short-term.
