Bain, or not, Perpetual builds stand-alone Wealth business
Perpetual Limited has acknowledged that its long, drawn-out sales process of its Wealth Management business to Bain Capital Private Equity has actually impacted the division’s bottom line.
The reality for Perpetual is that the Wealth Management business reported a 19% decline in underlying profit before tax of $23.7 million with the company’s commentary stating that it had been “impacted by uncertainty surrounding the sale of the business”.
It said it had also been impacted by an increase in employee, premises, and other related expenses.
The reality for Perpetual is that while it is still acknowledging uncertainty around the Brain Capital transaction it is attempting to establish it as a standalone operating business, capable of sale in the future.
“We are establishing a clear standalone operating perimeter for the Wealth Management business to support a potential sale and ensure continuity with minimal disruption for our clients ad teams,” it said.
“Our Wealth Management business is a high quality, profitable business with growing funds under advice (FUA), and the Board is focused on ensuring that any transaction that Perpetual may ultimately enter into is in the best interest of our shareholders.”
Perpetual chief executive and managing director, Bernard Reilly described the Wealth Management business having performed resiliently and had continued to grow funds under advice.
However, he also said that the business had faced headwinds with market related revenue increasing due to more buoyant markets while being offset by lower non-market revenue particularly in fiduciary and risk advisory.
Perpetual reported a significant turnaround in its Net Profit After Tax for the first half up 349% to $53.9 million compared to the prior corresponding period on the back of a a 2% increase in operating revenue to $697 million.
The Board determined an interim dividend of 59 cents per share unfranked
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