Equity Trustees has reported substantial growth for its corporate and superannuation trustee business, with funds under supervision increasing by 31.6 per cent to $185.1 billion in the year to 30 June 2024.
This excluded its UK and Irish businesses, following its decision last year to divest its interests in both operations in light of a strategic review.
This year’s results are also the first to reflect Equity Trustees’ newly combined Corporate and Superannuation Trustee Services (CSTS) business, which the firm said has been firmly positioned for growth.
Namely, CSTS revenue was up 15.3 per cent to $71.5 million, driven by organic growth and positive investment markets, with super fund members approaching 800,000.
“The short-term outlook for CSTS remains positive, with a strong pipeline of new business activity,” Mick O’Brien, Equity Trustees managing director, said in an ASX listing on Thursday.
Over the 2024 financial year, the group saw a 26.7 per cent lift in funds under management, administration and supervision (FUMAS) to $202.8 billion.
“The significant rise in funds under our stewardship flows directly through to our revenue and positions us as one of Australia’s top five wealth groups,” O’Brien said.
As such, revenue increased 23.1 per cent to $174. million for the year, while group underlying net profit after tax (NPAT) was up 13.8 per cent to $37.9 million.
Meanwhile, statutory NPAT increased 10 per cent to $20.7 million.
Equity Trustees revealed it has also made progress on its Australian Executor Trustees (AET) integration and is driving strong performance in its Trustee and Wealth Services (TWS) business.
Namely, SuperConcepts last year entered into an enterprise service agreement with Equity Trustees to take on the clients of the platforms business, ensuring they continue to receive specialist superannuation and platform services.
“The integration of the AET business has exceeded expectations, and the investment is positioning us well to win new clients and other opportunities that are now flowing,” O’Brien said.
“Our strategic focus and investments are paying off, and the results are flowing through to the bottom line.”
However, he noted that this growth necessitated investment, with expenses rising 28.3 per cent to $141.8 million over the period.
“Expenses were understandably higher as we transferred all AET staff to the group and continued to hire new staff in a tight employment market to manage our growth. Persistent inflation also impacted costs across the group.”
“Technology expenditure costs continue to be elevated but are expected to be largely complete towards the end of FY25.”
Meanwhile, TWS recorded a 30.3 per cent increase in revenue to $99.1 million, attributable to a full 12-month contribution from AET, the realisation of $3.6 million of revenue synergies from the AET acquisition and organic growth across most product lines.
Looking forward, O’Brien said the outlook for the group remains positive.
“The outlook for FY25 benefits from the scaling down of one-off costs related to the integration of AET and our substantial technology investments, and the exit from Ireland and the UK. The industry fundamentals continue to favour our specialist trustee model, despite increasing regulatory intensity.
“In the shorter term, global investment markets are likely to remain highly volatile for some time, however, our balance sheet remains strong with low gearing and healthy levels of liquidity proving flexibility for the future,” he said.
Equity Trustees reported a final dividend of 53 cents per share, bringing total dividends for the year to 104 cents.
