investor daily logo

Platinum announces turnaround program amid $1.75bn outflows

By Rhea Nath
2 minute read

In its latest half-year results, the asset manager has announced its intentions to “revitalise” the company following declining revenue and funds under management.

Platinum Asset Management has recorded net profit after tax (NPAT) of $35.6 million for the half year ended 31 December 2023, down 5.3 per cent from the prior corresponding period.

In an ASX announcement last week, it said average funds under management (FUM) slumped 9.1 per cent to $16.2 billion and underlying profit stood at $37.3 million, down 6.3 per cent.

It saw net outflows of $1.75 billion for the December 2023 half, with institutional outflows of $940 million.

Platinum also noted fee revenue decreased 6.9 per cent, largely due to the declining average FUM, and was partly offset by an increase in average fee bps.

For 1H24, it announced a fully franked dividend of 6 cents, which was down from 7 cents in the prior corresponding period.

Announcing the results, chief executive Jeff Peters, who took the reins from Platinum co-founder Andrew Clifford in December last year, highlighted it had been a “difficult” year at the firm.

“We have seen outflows, declines in revenue, and our investment performance is not where we would like it to be for our clients,” he said.

“Change is necessary and, while we have a full agenda, I am confident we can get it done.”

Platinum highlighted that, in an effort to “revitalise” the company, a reset phase was underway, with key actions to be implemented over the next one to four months.

These included measures to reduce costs and “right size” the business; a review of its product offerings and distribution channels, both onshore and offshore; a review and reorganisation of its investment research function, portfolio construction and risk management processes, and existing product design; and review of its remuneration framework.

Over the next six-plus months, the growth phase would look to implement recommendations to enhance the investment platform; build improved product and distribution capability through new channels; and complete back-off outsourcing projects.

This phase could see merger and acquisition opportunities ramp up, Platinum flagged, as it explored both organic and inorganic growth and diversification opportunities.

“The reasons I joined Platinum – the brand, the talent of our investment and senior teams, the legacy of success here in Australia – these things are still here,” Peters said.

“We must capitalise on them and improve where we can, and then we will be well on the way to revitalising Platinum for our clients and our shareholders.”