The firm recorded revenue of $9.7 million (up 26 per cent on the previous first half) and operating expenses of $7.4 million (up 6.6 per cent).
Funds under management increased by $94.1 million to a record $801.7 million, with $60.6 million of the increase due to market movements and $33.5 million the result of net inflows.
"The improvement in flows are a result of increased brand awareness for Australian Ethical and a return of confidence in equity markets that has driven industry flows into managed funds and away from term deposits," the company's interim financial report stated.
Employment costs increased by 9.2 per cent ($410,000) due to a round of redundancies that stemmed from Australian Ethical's decision to relocate its operations away from Canberra to Sydney.
Australian Ethical is struggling to sell or lease its property in Bruce, ACT.
"The Canberra market remains weak as a result of the change in government and, to date, no firm offers to purchase the property have been received," the financial statement said.
Australian Ethical managing director Phil Vernon said the company was repositioning itself "for long-term sustainability and success".
"Our net flows are strong, new client numbers are almost triple what they were a few years ago and our costs are being kept under control,” he said.
