Generation Life closed calendar year 2024 with $3.8 billion in funds under management (FUM), a 31 per cent lift on 1H24 and a 16 per cent increase over the six months to December.
Notably, group underlying profit after tax (UPAT) surged 152 per cent compared to 1H24, from $4.9 million to $12.4 million. Meanwhile, statutory profit climbed from $4.4 million in the prior corresponding period to $78.9 million.
In an ASX announcement on Friday, Generation Development Group (GDG) attributed this growth to the continued expansion of its FUM.
A key contributor was the completion of GDG’s acquisition of the remaining shares in Lonsec in August, with Lonsec’s reported $8.8 million in UPAT over the half-year bolstering the group’s overall result.
Moreover, GDG said investment bond sales momentum within Generation Life remains high.
Namely, investment bond sales saw record activity with 59 per cent market share of investment bond inflows in the September quarter. Year-on-year, this segment saw 29 per cent sales growth, representing 27 per cent of FUM growth.
“Brand recognition has grown and the number of advisers seeking a tax effective investment product as an alternative to other tax structures and as an estate planning tool, for their clients, has increased,” the firm said.
In an update to shareholders, chief executive Grant Hackett said this is an “outstanding” result for the group.
“When we first started off here, back in 2017, we were very much a monoline product. We were selling out in the marketplace with investment bonds and trying to lead the way there,” Hackett said.
“The composition has changed quite materially over the last few years, and as you can see, we’re now very much a highly diversified financial services group. We’re growing very, very fast in all of the key areas and sectors that we want to be in.”
Namely, Lonsec reported strong revenue for the half-year of $35.5 million, while growth in Research & Ratings saw revenue of $21.4 million, up from $19.4 million in 1H24. This, the group noted, was on the back of increased numbers of products rated following the continued expansion of its private market offerings.
Moreover, Lonsec Investment Solutions reported 19 per cent FUM growth of $12.7 billion, supported by the launch of 13 new managed accounts options over the period.
In February, GDG also announced its acquisition of 100 per cent of Evidentia Group Holdings for $320 million, marking a significant expansion in the managed accounts sector.
Evidentia, a key provider of investment management and tailored managed account solutions in Australia, will merge with GDG’s Lonsec Investment Solutions and Implemented Portfolios, under the name Evidentia Group, further strengthening its position in the growing managed accounts market – currently valued at over $200 billion and projected to reach $474 billion by 2030.
Expounding on this, Hackett said on Friday that the firm expects to see strong continued growth in Lonsec’s and Evidentia’s self-managed accounts business.
“So while we had $12.7 billion to close the calendar year at Lonsec Investment Solutions, combining that with the Evidentia acquisition that we did a couple of weeks ago, that’s taken us to over $25 billion in funds in the managed account space, and we really are the market leader in there.
“We’ve got plenty of great ideas and [are] already sort of executing very well with both of those teams,” the CEO said.
Looking ahead, GDG affirmed that Generation Life and the integration of Lonsec and Evidentia remain key priorities.
“Investment bond sales outlook remains strong and LifeIncome is expected to produce continued solid results. We expect to see continued strong growth in Lonsec’s and Evidentia’s self-managed accounts business.”
