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Platinum outflows settle following substantial April dip

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By Jessica Penny
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3 minute read

The firm has shared its May fund flows on the back of heavy redemptions from institutional clients the month before.

Platinum Asset Management’s funds under management (FUM) was $13.6 billion at the end of May, down from $13.7 billion in April.

In an ASX listing, the firm said it experienced net outflows of $295 million during the month, with the majority of outflows – some $246 million – stemming from the Platinum Trust Funds.

However, this was a small blow compared to the $1.65 billion in outflows seen in April, partly as a result of redemptions from institutional mandates and product rationalisation initiatives.

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In March, Platinum said it expected to see $1.4 billion in outflows – some $200 million was lost that month and the remaining $1.2 billion was expected to be redeemed in April.

“Platinum Investment Management Limited expects to receive partial redemptions of at least $1.4 billion from its institutional and wholesale business over the coming month with one large client indicating that it intends to rebalance its exposure away from benchmark agnostic global equity managers,” the firm said at the time.

As such, Platinum lost an additional $200 million more than forecast.

Platinum’s March announcement also included information regarding the progress of the firm’s “turnaround program”, which was first declared on 29 February.

It disclosed that an initial review had been completed, with the company targeting at least $25 million in annualised run rate savings. This savings target represents a 26 per cent reduction in the company’s annualised half-year expense base of approximately $96 million.

However, the fund manager conceded the savings will only begin to be realised during the last quarter of the 2024 financial year and are unlikely to generate a material impact on the company’s reported FY2024 profit, with the bulk of savings being progressively realised during the 2025 financial year.

Commenting on these changes, Jeff Peters, who stepped in as Platinum chief executive at the tail end of 2023, said: “In late February, we outlined a strategy to reset and position the business for future growth. I am pleased to be able to report that we are acting swiftly to implement the changes required as part of the reset phase.

“I would like to reiterate my firm belief that Platinum will emerge from this challenging phase as a revitalised business that is better able to leverage its strong brand and talented team for the benefit of its clients.”

Since then, the firm has also announced a formal strategic review into Platinum Capital (PMC) and Platinum Asia Investments (PAI) as it seeks a more profitable, streamlined structure under its turnaround program.