In an ASX statement this week, the firm said a large client intends to redeem $580 million from some of its Platinum Trust funds and an associated mandate between October and November.
This, the firm said, is the outcome of a manager review which the client had commenced earlier this financial year.
“It is expected that the redemption amounts will flow through to reported funds under management during those months,” Platinum said.
As at 2pm Tuesday, Platinum’s share price had dipped by over 7 per cent to 0.72 cents. This follows a longer period of instability for the fund manager, with its share price losing over 25 per cent over the past 12 months compared to gains of 10 per cent by the ASX 200 over the same period.
This marks Platinum Asset Management’s third major client withdrawal this year, following the exit of an institutional mandate worth $958 million in May and a smaller $360 million mandate the same month. The combined outflows pushed the company’s net redemptions for May to $1.6 billion, the largest monthly net outflow in over a year.
Overall funds under management have fallen from $11 billion at the start of 2025 to $7.9 billion as of the end of July.
In its FY2024–25 full-year results, Platinum reported total outflows of $5.6 billion, comprising $3.1 billion from retail investors and $2.3 billion from institutional clients. While institutional outflows fell slightly, down five per cent from FY23–24, retail redemptions rose 33 per cent from $2.3 billion the previous year.
The majority of these outflows came from its flagship Platinum International Fund, which experienced underperformance during the financial year, as well as the loss of its managers Andrew Clifford and Clay Smolinski in February. Having worked on the fund for over a decade, Clifford moved into an investment oversight role while Smolinski took a sabbatical – the portfolio management responsibilities were handed over to new hire Ted Alexander.
The changes have yet to boost performance, with the fund returning 3.4 per cent over the year to 30 June, compared with gains of 18.4 per cent by its benchmark, the MSCI World Index. Assets under management for the fund stood at $3.3 billion as of 30 June, down from $5.6 billion at the end of FY23–24.
However, chair Guy Strapp said the underperformance is not the only factor as ongoing media speculation about the firm’s future and possible takeover activity also led to outflows during the period.
“The third quarter of 2024 was dominated by inorganic activity, with the company receiving a number of unsolicited non-binding indicative offers, some of which were public and others which were not. By December 2024, none of these had eventuated but nonetheless resulted in disruption and instability for the business as things played out in the media,” he said in the results.
“This instability, combined with sustained lacklustre relative investment performance for our flagship fund, only served to put further pressure on fund outflows and resulted in the loss of a large institutional mandate, with consequential impacts on revenue.”
Since the end of the financial year, Platinum has entered into a binding agreement to merge with L1 Capital and, if this goes ahead, the firm will be renamed as L1 Group. The combination of the two firms will create a manager with $16.5 billion in assets spanning listed equities and alternative strategies.
