Australian Ethical Investment (AEF) investor relations material

Executive summary

• Achieved all strategic milestones for the half, including record half-year profits, with underlying profit after tax (UPAT) up 25% to $14.4 million and net profit after tax (NPAT) attributable to shareholders up 42% to $13.3 million year-over-year.

• Funds under management (FUM) reached $14.08 billion, up 6% year-over-year, driven by positive net flows and investment performance.

• Completed major strategic initiatives, including transition to GROW administration platform, insurance harmonisation, and integration of Altius and Charles River systems.

• Recognised with multiple industry awards for ESG leadership and sustainability, and continued advocacy for higher standards in corporate Australia.

• Board renewal and governance improvements continued, with new appointments and structured succession planning.

Financial highlights

• Underlying revenue rose 13% to $65.8 million, driven by 18% average FUM growth, while operating expenses increased 9% to $45.1 million.

• Underlying cost to income ratio improved to 68.8% from 71.8% in the prior year.

• Interim dividend increased 60% to 8 cents per share, fully franked, with a record date of 6 March 2026 and payment on 23 March 2026.

• Diluted UPAT EPS rose 24% to 12.54 cents, and diluted NPAT EPS rose 41% to 11.60 cents year-over-year.

• 10% of profits allocated annually to the Australian Ethical Foundation, with a record $2.8 million annual donation.

Outlook and guidance

• Expect continued positive net flows in superannuation, supported by super guarantee contributions and digital enhancements.

• Full-year FY26 cost-to-income ratio expected to improve by at least 1% over FY25, with revenue margin anticipated to remain stable at 0.91%.

• Medium-term focus on digital experience, direct marketing, new product innovation, and expanding distribution channels.

• Continued investment in business platform and governance to support long-term growth amid volatile market conditions.

• No immediate need for further M&A, but open to accretive opportunities.