City of London Investment Group (CLIG) H2 2024 earnings summary

Executive summary

• Funds under Management (FuM) rose 8.8% year-over-year to $10.2 billion as of 30 June 2024, recovering from lows in October 2023 driven by market volatility and geopolitical events.

• Net fee income increased 1% year-over-year to $66.2 million, with underlying profit before tax at $27.2 million and reported profit before tax at $22.6 million.

• Basic earnings per share were 27.8p (2023: 30.2p), with underlying EPS at 33.5p (2023: 36.5p), reflecting a higher effective tax rate of 24%.

• The Board recommends a final dividend of 22p per share, maintaining the annual total at 33p, with a rolling five-year dividend cover of 1.19.

Financial highlights

• Gross fee income: $69.5 million (up 1% YoY); net fee income: $66.2 million (up 1% YoY).

• Underlying profit before tax: $27.2 million (2023: $27.0 million); profit after tax: $17.1 million (2023: $17.5 million).

• Cash and cash equivalents: $33.7 million (2023: $28.6 million); no external debt.

• Cost/income ratio: 42% (2023: 41%), reflecting FX and inflationary pressures.

• Dividend paid and proposed: 33p per share (unchanged YoY).

Outlook and guidance

• Positive momentum in the second half of the year, with narrowing CEF discounts and improved flows, especially in International and EM mandates.

• Management targets operational net zero by 2050, with interim targets for emissions reduction by 2027 and 2030.

• Cost reductions of approximately $2.5 million planned for the next financial year.

• The Board remains confident in the recurring cash flow model and conservative business practices.