In an ASX announcement on Monday, the wealth giant revealed it expects to record a non-cash impairment charge of approximately $547 million pre-tax in its financial results for the full year ended 30 June, driven by net outflows from some of its strategies.
The company confirmed that among the outflows is $12 billion from strategies managed by J O Hambro and TSW.
“As previously announced in its quarterly updates throughout FY24, and in the second half of FY24 in particular, some key strategies experienced greater-than-expected net outflows, with net outflows of AU$8.0 billion for J O Hambro and AU$4.0 billion for TSW,” Perpetual said.
“Based on the projected earnings impact of these outflows and a resulting moderation of expectations for future flows, compared to the assumptions made at the time of the Pendal Group acquisition, a non-cash impairment charge of $417 million will be recognised against the carrying value of goodwill for J O Hambro, and $130 million for TSW. This will impact the statutory results of the group for the FY24 financial year.”
Last week, Perpetual announced Bernard Reilly, former chief executive of $300 billion Australian Retirement Trust (ART), has been appointed chief executive of Perpetual, effective 2 September.
He takes the reins from Rob Adams, who announced in May he would retire from his role as group chief executive and managing director, having held the role since September 2018.
Adams has also been the chief executive of asset management following a company reshuffle last year which saw its asset management businesses form one global division and create a simplified leadership structure.
At the time, Perpetual said Adams would retire following a period of orderly transition upon completion of the KKR deal which will see KKR acquire the firm’s corporate trust and wealth management businesses.
The sale is subject to a Perpetual shareholder vote and the board unanimously recommends this in the absence of a superior proposal. Shareholders are expected to receive cash proceeds and will retain their ownership in the firm under its new structure as an asset manager with $227 billion in assets under management.
