Magellan Financial Group has reported that it had $39.2 billion in funds under management (FUM) as of 31 July, down from $39.7 billion at the end of the month prior.
In an update to the ASX on Friday, Magellan indicated that it had again experienced net outflows in the month of July. Net outflows of $0.4 billion were declared, including net retail outflows of $0.3 billion and net institutional outflows of $0.1 billion.
This represented an improvement on June, when the fund manager declared net retail outflows of $0.4 billion and net institutional outflows of $1.7 billion for a total of $2.1 billion.
Between June and July, Magellan’s retail FUM fell from $18.4 billion to $17.8 billion, while its institutional FUM moved marginally higher, from $21.3 billion up to $21.4 billion.
Global equities FUM decreased from $19.1 billion to $18.5 billion, infrastructure equities FUM remained flat at $16.1 billion and Australian equities FUM lifted from $4.5 billion to $4.6 billion.
The last time the fund manager reported an increase in funds was at the beginning of this year. Magellan’s FUM rose from $45.3 billion at the end of December 2022 to $46.2 billion at the end of January 2023. But over the following six months, it has declined by a total of $7 billion.
Magellan is due to release its full-year results on 18 August. Chief executive David George has previously outlined a plan to return to $100 billion in FUM over the next five years.
At its half-year results in February, Mr George said that Magellan had “a well-defined and actionable five-year strategy which builds upon the qualities that have made us successful”.
The firm indicated that it was also implementing an ongoing strategy to diversify the business to deliver sustainable growth and revenue.
“Meaningful transformation takes time. Whilst it is still early days, I can report that we are making good progress in delivering on our FY23 strategic priorities and are encouraged by the improving trends that are emerging,” Mr George said.
“In the last six months, we have launched new strategies, refined our plan around staff retention, and enhanced our investment process to improve how we collaborate and generate ideas. These are key first steps in delivering on our five-year target of $100 billion in funds under management by 2027.”
Mr Formica has 30 years of experience in funds management, including a three-year stint as chief executive officer and director of Jupiter Asset Management from 2019 to 2022.
According to Magellan, the appointment formed part of an ongoing board renewal process which was previously announced to shareholders.
“From afar, I have always admired Magellan’s ability to innovate and evolve to stay on top of the industry and deliver for clients. I look forward to supporting the management team as they position the business to continue this focus,” Mr Formica said on his appointment.
“Australia has one of the best financial services industries in the world and I am confident that Magellan can position itself as the leading funds management business in this market.”
Jon Bragg
Jon Bragg is a journalist for Momentum Media's Investor Daily, nestegg and ifa. He enjoys writing about a wide variety of financial topics and issues and exploring the many implications they have on all aspects of life.
