GQG Partners (GQG) H1 2024 earnings summary

Executive summary

• Funds under management (FUM) reached $155.6 billion, up 49.5% year-over-year, driven by $11.1 billion in net flows and $23.9 billion in capital appreciation.

• Net revenue rose 53.1% to $363.1 million, and net operating income increased 54.9% to $273.2 million compared to the same period last year.

• Net income after tax was $201.2 million, up 56.4% year-over-year.

• All four core investment strategies outperformed benchmarks on one-, three-, and five-year bases, with top decile alpha and Sharpe ratios.

• Interim dividends declared and paid represented a 90% payout ratio of distributable earnings.

Financial highlights

• Average FUM for the period was $139.5 billion, up from $95.2 billion in 1H23.

• Distributable earnings totaled $209.9 million, up from $136.6 million in 1H23.

• Dividends paid amounted to $167.8 million, with dividend per share paid at $0.0566 and declared at $0.0641.

• Management fees comprised 94.6% of net revenue, providing stable earnings.

• Operating expenses increased 48.1% year-over-year to $89.9 million, mainly due to higher compensation, administrative, and distribution costs.

Outlook and guidance

• Continued strong momentum is expected into H2 2024, with ongoing investments in distribution, client-facing activities, and infrastructure.

• Private markets business (PCS) is not expected to be material to group financials in the near term but is seen as a long-term growth driver.

• Management expects continued fee pressure in the asset management industry but believes its fee structure is sustainable.