19th May 2015 09:03
LONDON (Alliance News) - Impax Asset Management Group PLC Tuesday said its operating margin came under pressure due to money invested in the first half of its financial year on pursuing new business.
Growth in assets under management also was muted in April, the month following the end of the first half of its financial year.
The asset manager, which looks for opportunities arising due to scarcity of natural resources, had already said that assets under management increased by 13% to GBP3.108 billion in the six months ended March 31, but Tuesday's interim results showed that the figure stood at GBP3.110 billion at the end of April.
Pretax profit increased by 41% to GBP1.9 million in the six months, compared with GBP1.4 million in the corresponding period of the prior year, even as revenue increased by 6% to GBP10.4 million and operating costs rose by 13% to GBP8.1 million, meaning that its operating margin fell to 22% from 27%.
"Notwithstanding the material top-line growth, the drop in operating earnings and margin reflect the investments we have made to pursue new business, particularly in the area of real assets," Chief Executive Ian Simm said in a statement.
The increase in pretax profit was due to lower charges relating to legacy long-term incentive schemes, a fall in fair value losses and more investment income, more than offsetting a bigger charge relating to change in third party interest in consolidated funds.
Impax increased its interim dividend to 0.4 pence per share from 0.3p.
"We retain our positive outlook for global equities and believe markets will continue to edge higher, albeit with periods of volatility. Interest in resource efficiency is gaining additional momentum as investors allocate further assets to environmental and resource efficiency markets and our products are integrated within a widening range of asset categories including socially responsible and impact investments, high growth global equities and liquid alternatives," Simm said.
"We continue to develop our business in response to rising investor demand and our mandate pipeline is promising, with interest in both our listed equity products and real asset strategies. Impax remains well placed to build further long-term shareholder value," Simm said.
Impax shares were down 7.6% at 47.00 pence on Tuesday morning.
By Samuel Agini; [email protected]; @samuelagini
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