Rathbones Group (RAT) H2 2025 earnings summary

Executive summary

• Achieved a five-year high in market capitalization, exceeding GBP 2.4 billion.

• Completed integration of IW&I ahead of schedule, creating a unified and scalable organization and launching the first share buyback.

• Announced a total dividend of GBP 0.99 per share, up 6.5% year-over-year, continuing a 20-year tradition of progressive dividend growth.

• Strengthened executive team, managed CEO transition, and set a clear strategy for 2026 and beyond.

• Launched and extended a share buyback program, reflecting disciplined capital allocation.

Financial highlights

• Funds under management and administration (FUMA) rose 5.9% to GBP 115.6 billion by year-end, recovering from Q1 lows.

• Operating income increased 3.1% year-over-year to GBP 923.3 million, with all principal income streams growing.

• Underlying profit before tax grew 4.6% to GBP 238.1 million.

• Statutory profit before tax surged 53.5% to GBP 152.9 million, aided by reduced integration costs.

• Underlying basic EPS rose 5.5% to 161.6p per share.

• Final dividend proposed at GBP 0.68 per share, total dividend GBP 0.99.

Outlook and guidance

• Targeting a 30% underlying operating margin by Q4 2026, with a 28% margin expected in Q4 2025.

• Margin in H1 2026 will be lower due to one-off investments in client lifecycle management systems.

• Expecting FUMA growth of 3% in 2026, with stable inflation and interest rates in line with market expectations.

• Commission income projected to decline 5% in 2026 as volumes normalize; net interest income expected to be flat.

• Integration costs to fall significantly in 2026, with further cost efficiencies and in-year synergy benefits to rise by £16m.