Tatton Asset Management (TAM) H1 2025 earnings summary

Executive summary

• Achieved record organic net inflows of £2.3 billion year-to-date and £1.832 billion in H1 2024, with AUM/I rising 34.9% year-over-year to £19.948 billion at 30 Sep 2024, reflecting strong momentum and investment performance.

• Group revenue up 23.7% to £21.7 million and adjusted operating profit up 22.8% to £10.9 million, with margins above 50% and robust cash generation.

• Interim dividend increased 18.8% to 9.5p per share, reflecting confidence in financial performance and liquidity, with a 70% payout ratio of adjusted earnings.

• Strategic focus remains on organic growth, targeting £30 billion AUM/I by FY29, supported by strong IFA relationships and a scalable, capital-light business model.

• Maintained a leading position in the UK DFM MPS market, with high recurring revenues and continued expansion of IFA firm relationships.

Financial highlights

• Group revenue and adjusted operating profit both grew by approximately 23% year-over-year in the first half, with group margin maintained above 50%.

• Adjusted fully diluted EPS increased 30% to 13.67p; basic EPS rose to 13.03p from 8.97p.

• Net cash position at period end was £26.9 million, with capital resources at 265% of regulatory requirements.

• Operating cash conversion at 94%, with strong liquidity and regulatory capital headroom.

• AUM grew 35% year-over-year, equating to £5.1 billion, with £2.3 billion added in six months from strong flows and investment performance.

Outlook and guidance

• Guidance for net inflows is set at £200 million per month for the remainder of the year, reflecting a prudent approach despite ongoing strong flows.

• On track to deliver full-year targets and the £30 billion AUM/I goal by FY29, regardless of the outcome of the Perspective contract renegotiation.

• Paradigm segment expected to deliver H2 performance in line with H1, with signs of optimism from a 47% year-over-year increase in mortgage applications.

• Capital markets remain uncertain due to geopolitical and macroeconomic factors.